Post by
garyreins on Oct 23, 2024 9:12pm
JOIN THE ROTATION PARTY!
"Last week, Canadian business media was flagging a theme we've been covering for some time: that continued central bank rate cuts should cause the $300bln of fund flows over the past 30 months into term deposits/money market funds (Figs. 1 & 2) to reverse as yields on those investments continue to decline. As yield-seeking investors reallocate those funds, we see potential for Canadian REITs to materially outperform, as they have in past similar periods since 1998. Distribution yields average 6% for retail REITs and 5% for industrial REITs. Additionally, looking at 2025 AFFO growth, we see “growth + yield” sums exceeding 10% (Fig. 3) for much of our coverage universe. That represents a re-acceleration of growth, largely because the interest expense headwind has quickly diminished (i.e., no longer growing faster than EBITDA)."
Things are sitting pretty here. The only mystery is, why these trds keep sinking still....we should be going back to Sept 13 highs and then take them out by Dec/Jan