Interesting point here - should rally from oversoldSInce May 2024, has traded in line with the XRE-TSX (CDN REIT ETF), after October/November outperformance reversed by recent underperformance.
Trading at 91% of NAV and implied cap rate of 8.1%, a premium to the CDN REIT sector. Levrerage of 6.5x net debt/ebitda is reasonable, as is 76% payout ratio.
I like the business due to the demographic trends and relative wealth of the CDN seniors (benefited from principal residence inflation over 40 years, plus many had Defined Benefit Pensions and govt retirement benefits are indexed for inflation) which benefits SIA's Retirement Sector while LTC sector is recession proof and is currently supply constrained.
I have a concern about the cutbacks in immigration (while needed) may hamper labour availability and could mean wage inflation to attract employees in what has been a notoriously higher turnover employee base.
US seniors REITs currently trade at a nice premium to NAV, partly explained by larger size and share price liquidity.
Technically, Daily Relative Strength INdicator for SIA has fallen below 30 to 26, lowest level since March 2023. Slow Stochastics at 7.2 indicates severe daily oversold levels. Didn't hold the 200 day moving average at $15.03. Relief rally should be forthcoming IMO.
Current Dividend yield of 6.4% looks sustainable unless bond yields continue to rally, which is the key risk to the share price. CDN Govt 10 year has risen from about 70 bps since september from 2.8% to 3.5%.
Good luck to all.