Leading REIT Analysts

4 min read

Many investors often focus on the investment-outputs such as cash flows, dividends, return on equity, sales growth, and earnings upon evaluating investments. These are essential aspects of course, but careful consideration should be given to numerous other variables.

REITs are one of the safest options for investments with strong security while offering long-term stable payments. Behind top-performing REITs, there are the professionals who dedicate their time to constantly assessing all the countless variables in guiding their respective fund.

As a REIT investor, you are the foreman in constructing your wealth-building. Every effort and research you divulge in will eventually pay-off when you have the right materials and the best contractor.

Careful research and due diligence on not only the leading REITs but also new trends in the industry as well as following the leadership of these companies will help you in deciding which REITs will complement your portfolio. For example, you may want to look for recession-resistant dividend assets that focus on business development and shape your portfolio with this trajectory in mind.

Apart from conducting your own research, it is also prudent to follow the guidance of analysts and other professionals who study this industry.

Listening to what experts say about the industry is also a significant contribution in planning your investment strategies and its success. Moneyshow.com is one source where real estate experts speak about their views on REITs and which companies to look for.

1. Tim Plaehn, Investors Alley’s The Dividend Hunter

Tim Plaehn is a lead investment research analyst for income and dividend investing at Investors Alley. He writes for The Dividend Hunter, 30 Day Dividends, and Automatic Income Machine where he tackles dividend investment recommendations to investors.

One example of one of Plaehn’s recommendations is Store Capital, a new REIT which began in 2014 but is managed by a team with three decades of total experience. Store Capital holds single tenant properties and rents on long-term “triple-net” leases.  The residents are the ones paying all property-related costs such as repair and maintenance, taxes and insurance. The REIT collects monthly rent without all the responsibilities of paying property expenses.

He considers this REIT to have an attractive combination of higher yield and higher dividend growth among the older REITs that belong in the same group.

2. Dr. Carla Pasternak, Dow Theory Letters

Dr. Carla Pasternak is the columnist for Income Investor and is enthusiastic about the stock market. She enjoys helping investors from all walks understand the complexities of income investing to which she applies both technical and fundamental analysis to identify overlooked and underrated edges of the income universe.

Dr. Pasternak’s confidence in data center REITs led her to recommend QTS Realty Trust which is a data center focusing on security and Department of Defense compliance. As the demand for safe data storage increases, investing in data centers attracts security-sensitive industries including several government agencies and private contractors.

Currently, QTS Realty owns, operates and manages 25 data centers in the United States. It has one of the largest data centers in the world with a 969,000 square foot center in Atlanta, Georgia  occupied by 227 customers. This REIT’s dividends have increased with an average of 10% annually over the past three years, to $1.56 per share in 2017 and the shares yield approximately 3%.

The numbers are positive, with a growing price trend. She recommends to buy based on the firm slow and steady growth strategy.

3. Todd Shaver, BullMarket.com

Todd Shaver believes in REITs focusing on properties leased to government bodies due to the fact the government tenants remain loyal and stay significantly longer than private sector tenants, with U.S. government agencies occupying the same properties for about 20 years or so.

The Government Properties Income Trust is a REIT focused on owning, managing, and operating properties rented by government organizations.

The Government Properties Income Trust is the U.S. government’s largest landlord with 74 properties located in 31 states. Although there are rumors about the US downsizing the government, the recent outlook looks promising with a healthy dividend yield of 9.25%.

4. George Putnam, The Turnaround Letter

Geroge Putnam believes in the REIT mantra “Management, management, management.” With location being the main driving force in real estate, the management team plays a critical role in the decision making including which locations and asset classes the fund acquires.

He sees the potential in three REITs mainly focusing in a few sectors including hospitality, suburban office space, and mortgages.

5. Bob Carlson, Retirement Watch

Bob Carlson is a writer and retirement adviser who guides investors seeking high-income opportunities. His monthly newsletter Retirement Watch tackles independent and objective research incorporating all the financial issues of retirement and investment planning.

Bob recommends Cohen & Steers Realty Shares as it is an actively managed fund coupled with it’s long tenure in the REIT industry. This fund invests in REITs with prime properties in malls, residential apartments, offices, and other real estate located in strategic areas. The fund is also quick to adapt to economic changes as seen in their ongoing acquisitions of data centers to their portfolio.