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

Scotia cuts as well

[Income]

"The interest income = a material 34% of AX 2024E FFO and is expected to remain PIK in the near-term (i.e., balance now = $144M)."

They asign a 50% probablity to a distribution cut.

Someone please help me understand the bullcase.

[Catchtherally]

No bull case until rates come down. A 100bps cut would bring affo to .22 per unit. On an annual basis this is .88 which would make this a $8.8 unit price based on same affo multiples. In other words, ax will rocket when there is rate cuts.  In the meantime they can sell some properties to buy back their own stock to help boost ffo. 

[Torontojay]

I would argue that there is no bull case until the capitulation in commercial real estate takes place (if there is one) There are $1.5 trillion in Cre's that come due by the end of 2025. It is estimated that out of the $929 b in loans that have to be refinanced this year, 14% of them will default on their loans.  A significant number of these loans will have to be written down which will

[garyreins]

You said it yourself- THEY CUT RATES before all this plays out....they're not here to destroy peoples lives.....the inflation card has been played to the MAX.   PCE is already in their target.  3 cuts becomes 6-10 when sh1t hits the fan