I have been intensively involved in the real estate sector and have discovered some supposedly exciting companies such as
$SPG (+1.42%)
$GLPI (+1.74%)
$CUBE (+2.6%) and $BRX (+2.58%) discovered.
But there are special features to the valuation of REITs. 🧐
Traditional key figures such as high returns on capital or margins are often misleading, as REITs are legally obliged to distribute at least 90% of their taxable income 🤑 and are also highly leveraged.
In order to better assess REITs, I have read up on the subject and adjusted my valuation standards. Instead of adjusted earnings, I now focus more on funds from operations (FFO) and adjusted funds from operations (AFFO), which more realistically reflect operating profitability.
Here are some of the companies that I find particularly interesting:
- Public Storage $PSA (+1.58%) Leading provider in the self storage segment with an FFO yield of approx. 5.9%
- Prologis $PLD (+0.8%) Global leader in logistics real estate with strong growth
- Equinix $EQIX (+1.78%) Data center operator with a scalable business model
- Agree Realty $ADC (+1.56%) Focus on retail properties with long-term rental agreements and an FFO yield of approx. 5.7 %.
I also see Energiekontor $EKT (-0.28%) as an alternative real estate investment 🤓. Energiekontor currently operates 39 of its own wind and solar parks, which generate electricity revenues instead of rental income.
Which companies do you see as particularly promising for a long-term investment?
