Top Pick First stock in the clip and two sets of comments. Surprised to have a REIT as a top pick given that he's been avoiding the sector. GLTA
https://www.bnn.ca/video/jason-mann-top-picks~986583
TOP PICKS
MILESTONE REIT (MST_u.TO)
•In general we’ve been avoiding the REITs due to their higher valuations and sensitivity to rising interest rates.
•But, not all REITs are created equally, and the 10 per cent sell-off in the sector has created some opportunities.
•Milestone is a multi-family REIT. They own properties in sunbelt southeast and southwest U.S. (in all of top 10 fastest-growing markets).
•Growth by acquisition story: they have been a good acquirer of assets and management has been doing this for more than 20 years.
•Have also delivered organic growth through rent increases, given the desirable markets they operate in.
•Payout ratio of only 52 per cent leaves lots of room to grow dividend (they just bumped it slightly with latest acquisition). Currently, yield is 4.5 per cent. That, plus its low volatility characteristics, make it a buy for us.
•Trades at 10 per cent discount to Canadian peers and 33 per cent discount to U.S. peers.
MST.UN-T2016-11-03TOP PICKJason Mann
In general REITs could get pressure from interest rate increases, but the 10% correction they got so far has made a buying opportunity in this one. MST.UN-T is a multi family REIT, with properties in the sun belt, some of the most desirable areas, and the fastest growing areas. They are a growth by acquisition story. They also deliver organic growth through rent increases. The payout ratio of about 52% leaves lots of room for increases. About 4.5% yield, having been bumped slightly after their last acquisitions.
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Price:
$17.850
Subject:
NORTH AMERICAN
Bias:
CAUTIOUS
Owned:
Yes