TSX:AX.PR.E - Post by User
Post by
garyreinson Oct 29, 2024 9:23pm
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Post# 36287965
HIGH YIELD
HIGH YIELDLets make the assumption BOC goes another 50bp in Dec which is a base-case unless Canada economy randomly picks up steam with inflation going back up in these next 2 months...very doubtful
3.25% overnight rate, IIRB borrowing rate 4.30%.
AX- 7.5% DIV
SRU- 7.5% DIV
PRV- 7.5% DIV
BTB- 8% DIV
Thats a relatively easy +3% pocket of income
HR yields 5.6% now but its AFFO free cash flow $1 affo / $11 = 9.10%, so its just arbitrarily a 200-300bp above the usual spread to 10yr CAD bond
These cad trds need to get going, thats all im saying here. Ill buy in the meantime as this becomes a no brainer now
The difference with buying those reits on margin before at 5.5% and getting a 9% dividend was if they cut it you're screwed...like D.UN and NWH.UN did, but now, its hard to make the case that any REIT will cut their dividend as rates are being lowered.