TSX:MRG.DB.B - Post by User
Comment by
Defiance2050on Apr 27, 2021 9:41pm
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Post# 33080007
RE:RE:Look out below!!
RE:RE:Look out below!!Capharnaum wrote: SargeX wrote: Earnings just out and quite a mess.
I'm starting to get a tad tired of MRG. We only have a minor position and only bought it to replace some of the cash from the NVU sale. Unfortunately, it was right before Covid and it is the only "loser" stock we have.
I'm certainly running out of patience and now debating whether to sell half and just use the dough for extra short term trading.
https://www.morguard.com/news-knowledge/news-article?newsId=123282
I'm not sure why you would qualify the earnings as "quite a mess". Q over Q, 44% of the same property NOI decrease is due to the higher $CAD, the rest is due to a decrease in student related leases plus government measures that prevent evictions or raising rents due to COVID while costs slightly increased. All of this was fairly predictable for a residential REIT, and other than the $CAD, it will sort itself out in time. As to the earnings, there was a non-cash fair value gain on Class B LP Units that explains close to 100% of the difference.
Despite these headwinds, the payout is still on the low side at 63%. They do have renewals coming up on their mortgages which should be done at lower interest rates later in the year. Unless they do acquisitions, this is a pretty conservative stock to hold for income (return of capital) with eventually an increase in NAV and share value as we get out of COVID.
I personally dont own but have been considering with free cash purchasing shares.
Good points. Not sure if it follows the student housing but occupancy rate decreased significantly both q/q and y/y.
Atleast in the near term in my perspective this was minor negative quarter. MRG hasnt done as much mortgage renewal rates to the extent of CAR as well as purchasing or selling properties.
I am bullish on Apartments growing on new rents as older tenant turnover. Cap rates especially in big cities have been dropping.