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Bah! Humbug! Beware Of These 'Sucker Yields'

Published Fri, 23 Nov 2018 07:15:00 -0500 on Seeking Alpha

I know it’s Black Friday, and that means that many investors will be out shopping for bargains today. It’s really tempting these days to jump into the fray and load up on some extremely cheap REITs, because the signs are everywhere.

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Yet, with all the excitement surrounding this festive holiday season, I am going to be taking a much more conservative approach, not despising REITs but the dividend yields that are just too good to be true.
That’s fine, because my job as a REIT analyst is to call out the REITs that I refer to as “sucker yields,” and even shout out “Bah! Humbug!” much like the fictional character Ebenezer Scrooge from the classic Charles Dickens novel A Christmas Carol.
Oftentimes, I must be critical when I see a flaw in a company’s business model, much like when shopping for bargains, as Warren Buffett has said, “Price is what you pay, value is what you get.”
When you purchase shares in a high-yielding stock, you are essentially getting (in the simplest form) a discounted present value of future cash flows. This is almost like scrambling over to get the last remaining TV set at Best Buy - you become emotionally charged, almost manic depressive, causing unjustified panic. Then, when you get home, you find out that the TV set was not what you expected. Frank J. Williams said it best in his book If You Must Speculate, Learn The Rules:
“People of the dupe type are... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
CBL & ASSOCIATES PROPERTIES 0.92   0.0 -0.95 0.30 27.52
WP GLIMCHER 3.55   11.4 0.31 1.00 26.74
APOLLO COMMERCIAL REAL ESTATE FINANCE 18.59   11.9 1.56 1.84 9.86
GOVERNMENT PROPERTIES INCOME 6.87   0.0 0.00 0.00 0.00

CBL & ASSOCIATES PROPERTIES - CBL
CBL & ASSOCIATES PROPERTIES - CBL  


Older articles featuring Cbl & Associates Properties (CBL):
Washington Prime Group: Why A Dividend Cut Is Very Likely
Our High Yield REIT Portfolio: Q2 2019 Update
CBL Properties Declares Preferred Stock Dividends
Our High Yield REIT Portfolio Heading Into The 2nd Quarter
Washington Prime: Why I'm Short This 18% Yielder
Dividends By The Numbers For March 2019 And 2019-Q1
Deep Value And 18.5% Yield From Washington Prime
Tanger Factory Outlet Centers: What Does A Complete And Unbiased Analysis Yield?
Our 'Top Preferred Stock Pick', 9% Yield And Big Upside, From Pennsylvania REIT
CBL Properties Declares Common Stock Dividend and Preferred Stock Dividend

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