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Simon Says This High-Yield Blue-Chip Is A Very Strong Buy

Published Fri, 11 Jan 2019 09:00:25 -0500 on Seeking Alpha

This article was co-produced with Dividend Sensei.
If you want to enjoy both strong returns over time as well as generous, safe and growing income, few things are better than a quality REIT. Thanks to the worst market correction in a decade, today you can find even world-class companies trading at very attractive prices.
Let's take a look at why Simon Property Group (SPG) is a strong buy for almost any diversified dividend growth portfolio. In fact, from today's attractive price (26% discount to fair value), Simon is likely to deliver not just generous, safe and growing income, but close to 14% long-term total returns.
Simon Property Group: The King Of Class A Malls

(Source: Hoya Capital Real Estate)
There's a common belief on Wall Street that the retail apocalypse, led by the rise of e-commerce giants like Amazon (AMZN), will be the death knell of malls. In reality, e-commerce is merely growing twice as fast as traditional retail, which is thriving thanks to the adoption of omnichannel which incorporates technology like the internet into traditional retail. In the past seven years, retail sales have continued expanding along with the economy, thanks to mall operators like Simon adapting to the new retail paradigm.

(Source: SPG Investor Presentation)
While low-quality malls (Class D, C and B) are indeed struggling, high-quality Class A Malls (which make up 26% of all malls), ones like what Simon owns, are thriving. Today Simon... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
CBL & ASSOCIATES PROPERTIES 1.38   0.0 -0.95 0.35 27.34
WP GLIMCHER 4.18   24.6 0.17 1.00 24.10


Older articles featuring Cbl & Associates Properties (CBL):
Dividend Cuts And Overdue Rent: REIT Earnings Recap
Our High Yield REIT Portfolio - Optimizing Rebound Potential
Now Is Not The Time To Be A High-Yield REIT Investor
Macerich: Debunking Three Bear Theses, Including Why I Want A Dividend Cut
Introducing This Growing Dividend Portfolio
Washington Prime Is Undervalued Regardless If It Cuts The Dividend
Our 2020 High Yield REIT Portfolio
These REITs Are Likely To Cut Their Dividend In 2020
The Retiree's Dividend Portfolio - Jane's November Update: A Reminder Why We Sold Shares Of CBL.PD
The Mystery Of REIT Dividend Cuts In The Great Recession