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Melcor Developments Ltd T.MRD

Alternate Symbol(s):  MODVF

Melcor Developments Ltd. is a diversified real estate development and asset management company The Company develops and manages mixed-use residential communities, business and industrial parks, office buildings, retail commercial centers, and golf courses. The Company operates in four segments: Land, Properties, REIT, and Golf. The Land segment is responsible for purchasing and developing land to be sold as residential, industrial and commercial lots. The Properties segment owns approximately 24 leasable commercial, retail and residential properties and other rental income producing assets, such as parking lots and land leases. The REIT segment owns approximately 38 leasable commercial and retail properties and other rental income producing assets, such as residential property, parking lots and land leases. The Golf segment owns and manages three 18-hole golf course operations (one of which is 60% owned) and has a 50% ownership interest in one 18-hole golf course.


TSX:MRD - Post by User

Comment by babybunnyon Mar 18, 2021 1:15am
198 Views
Post# 32823732

RE:Spike in buying interest recently?

RE:Spike in buying interest recently?I think this is a rare case where cheapness alone really was the main catalyst.

At the COVID trough, MRD was trading at less than 20% of book value.  Even crummy companies rarely drop below half of book, and Melcor is a well-run company that over its history has more than earned its cost of capital.   It just happens to operate in a jurisdiction that has fallen on hard times, and because of  the nature of its business lacks the ability to react swiftly to this change in circumstances.  Even so, the company has gotten through the pandemic with an inconvenient pause in earnings, but no losses.

While Melcor will not appeal to the Reddit crowd, those looking ahead ten years (and one hopes, a better-balanced real estate market in Alberta) can see book value doubling and Melcor's share price reaching book. That would make it a conservative six-bagger not even counting the juicy 4% yield we get paid along the way.  Quite sufficient for my purposes.

Just my opionion, do your own due diligence.



  


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