“US futures were steady on the last trading day of the year, with the S&P 500 a whisker away from a record high and global shares on track for their best annual performance since 2019. The S&P 500 (SPX) traded just a few points away from its all-time peak on Thursday, extending its 2023 advance to nearly 25%. The Nasdaq 100 has already posted its best year since 1999 on expectations the Federal Reserve will cut interest rates aggressively in 2024.”
(Excerpted from Bloomberg Media Website before the open this morning - subscription required.)
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StockCharts View 2.5 yrs https://stockcharts.com/h-perf/ui?s=$INDU&compare=$COMPQ,$SPX&id=p83812329512
The overall value of my portfolio is still below its peak in 2021, but not far behind. My taxable account grew a lot in 2023, from investment returns as well as interest from CDs, Treasuries, money markets and short term bond funds. I also started drawing Social Security payments in 2023 and our overall income exceeded our expenses by quite a lot.
Yes. Out with a whimper …
What I've noticed gathering steam over the last month is REITs and the obvious, small caps. I know the pundits love SC's going forward. I haven't read anyone promoting REITS, but I wonder. I picked up Avantis Real Estate ETF, AVRE a couple weeks ago, just to be contrarian from others. Very small bet though.
Barron's published The Best Income Investments for 2024 yesterday.
REITs are mentioned in the article.
FWIW, Piper Sandler analyst Alexander Goldfarb believes the sector's outlook is good.
He likes Simon Property, Brixmor Property Group, Kite Realty Group Trust,
EastGroup Properties and Terreno Realty.
https://www.msn.com/en-us/money/savingandinvesting/the-best-income-investments-for-2024/ar-AA1mdhxj
I recall @davidmoran likes FRT. Still 26% undervalued (Morningstar.)
Stock Rover pegs the target price @$107.50, just 4.32% from where it sits at the end of 2023. I continue to track it.
2024 will determine whether I stick with PSTL. David Sherman warned about share dilution in the REIT sector, and that DID happen in '23. Very attractive dividend, though, and lots of room for growth.
9% undervalued. (Morningstar.)
1-year return: +6.74%.
Price/Cash Flow 10.37%
Yield: 6.52%. Payout ratio: 728.85% is NUTS. What gives with that?
The best measure of “earnings” (or distributable cash flow) for REITs (due to accounting rules like depreciation etc. which don’t affect cash flow) is funds from operation/adjusted funds from operation (FFO/AFFO)….a quick Google search found PSTL’s AFFO is $1.01, with a distribution of 95 cents. That’s a mid 90’s% payout ratio, which doesn’t allow much retained capital for growth (meaning debt or equity issuance will be required for growth).
Sorry if you know all of this!
Happy New Year
EDIT to add: Just remembered that REITS are REQUIRED to pay-out something like 90% of profits, yes? So, then......
An in-law works there and some aspects of business are good