Dividends4Life: Reasons To Buy W. P. Carey

Reasons To Buy W. P. Carey

Posted by D4L | Saturday, January 04, 2020 | | 0 comments »

Our latest buy alert at The REIT Forum is W. P. Carey (WPC). W. P. Carey is one of the largest and best triple net lease REITs. Shares are back on sale after being too expensive over the prior few months. We're thrilled to see another opportunity in WPC. We're initiating a position in WPC for about 1.2% of our total portfolio. There are a few things you'll want to know about WPC...

  1. They are an international REIT with significant exposure to Western Europe.
  2. They are able to use their European exposure to issue lower-cost debt.
  3. They significantly reduced their overall leverage during the last year, earning a lower risk rating (now 2.0, was 2.5).
  4. The portfolio includes an emphasis on industrial and warehouse assets. Pricing in industrial REITs demonstrates the demand for these assets.
  5. A strategic merger in 2018 simplified the company and made it significantly more appealing.
  6. Triple net lease REITs usually trade above NAV (net asset value). They issue shares using the premium to NAV. They purchase more properties with the cash raised from issuing shares. These transactions are regularly accretive to existing shareholders.
Source: Seeking Alpha

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