Artis Real Estate Investment Pref Shs Series E T.AX.PR.E

Greg Newman - BNN - Weak Buy

[Possibleidiot01]

WEAK BUY

Artis Real Estate Investment Trust(AX.UN-T)

16/08/2023

 

Buy the preferred shares, repriced in September at BOC 5-year rate plus 3.3%?

Tempting. You'd get a yield of about 8% until the end of September, and 7.25% after that unless they call it back.  You could buy a 5-year GIC in a registered account, no risk, and a yield of 5.32%. Or buy a laddered group of preferreds with about 6%.

Pretty indebted, not the best credit rating, fairly illiquid. If he's going to take the risk, he really wants the reward. He doesn't love either, but the AX.UN common shares with a yield of 8.34% are a better bet right now.

property mngmnt / investment

 

N/A

Unknown if he owns

[babybunny]

Yield on par will be about 7.25% on reset.  Plain old yield (i.e., yield on price) will be north of 10.5% on reset if share price remains mired in the low 17s.  I did not see Newman's appearance but I sure hope he did not understate the yield in this way.

[Frankie10]

Love that Artis can buy back debt/prefs at a discount with an effective yield of 10%+ ... keep eating these cheap units Mr. Manji!

[MyHoneyPot]

Really not a informed opinion. The company has been buy back the E and I series of the preferred shares as well and stock, so the company is buying back the stock.  The E shares are trading at $17.25 and when repriced in two weeks will pay BOC 5 year rate (4.2 plus 3.3%) close to 7.5 percent based on a $25 dollar strike price for perferred shares.  AX.PR.E is currently trading for $17