TSX:BPO.PR.A - Post by User
Post by
pierrelebelon Sep 23, 2023 2:09pm
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Post# 35650778
The Trend is Not Your Friend
The Trend is Not Your Friend
This may explain some of the recent weakness in all BPO preferred shares:
From Seeking Alpha (Sell recommendation Aug 15/23):
Summary. Brookfield Property Partners LP preferred shares were downgraded to "Sell" due to high debt levels and a declining FFO. Q2-2023 saw FFO remain negative even though there was marginal improvement in office occupancy levels. Refinancing will be challenging, and mortgage defaults are expected to increase.
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My wife and I still own 4,700 BPO.PR.T scheduled for reset in a few months and do not plan to sell at this time. Based on "Canada 5 year" rate of 4.2% we now expect the annual dividend rate to be reset at about $1.80/$1.85 on December 1st, 2023, effective with the March 31st 2024 payment.
Based on current depressed share price this will work out to a yield of nearly 15%.
While other BPO 5 year reset preferred shares may offer higher potential reset payments in the future, we still feel the "T'"s offer the best deal at this time as we will benefit from the higher dividend - almost immediately, not two, three or four years in the future.