TSX:DIR.UN - Post by User
Post by
retiredcfon Dec 21, 2024 1:20pm
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Post# 36373683
Concerns Addressed
Concerns AddressedDream Industrial has been drifting lower all year, and hit a 52 week low. Seems to get no respect and yet everyone says increased Industrial space for logistics centres and data centres etc. are/will be needed. Has anything changed with this company fundamentally? Do you still like it into 2025? Also, could you inform me what a realistic book value a share would be? And finally do you see it, like Pure Industrial, as a likely candidate for a takeout by a pension fund or private equity?
We still like it. The sector has bounced around with worries about interest rates (maybe not dropping as fast) and possible recession in Canada. It is cheap at 11X cash flow, and has a very acceptable payout ratio (12 months) of 58%. Occupancy is 95.5% and rental income rose 7% last quarter (cash flow per unit up 4%). We think it is well-run, and expect better things next year (no guarantees). DIR does have some significant European exposure and this may be concerning to some investors with weak economies there. Book value (Bloomberg) shows as $16.74 but book is not always a reliable indicator in the sector. We would consider it a decent takeover target. (5iResearch)