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Alexandria (ARE) Rewards Investors With 3% Dividend Hike
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Alexandria Real Estate Equities, Inc. (ARE - Free Report) recently announced a 3% sequential hike in fourth-quarter 2020 cash dividend. The company will now pay a dividend of $1.09 per share, up from $1.06 paid in the third quarter. The increased dividend will be paid on Jan 15, 2021, to shareholders of record as on Dec 31, 2020.
Based on the increased rate, the annual dividend comes to $4.24 a share, resulting in an annualized yield of about 2.5%, considering Alexandria’s closing price of $171.04 on Dec 7.
In fact, solid dividend payouts are arguably the biggest enticement for real estate investment trusts’ (“REIT”) investors. Alexandria also remains committed to that and its common stock dividend for 2020 indicates a rise of 6% over the year ended Dec 31, 2019.
Further, earlier this June, the company announced a 3% sequential hike in second-quarter dividend to $1.06. These dividend hikes reflect Alexandria’s continued efforts to boost shareholder wealth.
Per management, the hike in dividend is in sync with the company’s strategy of sharing growth in cash flows from operating activities with the stockholders, while also retaining a significant portion to reinvest in its strong development and redevelopment pipeline that consists of new Class A properties. Although, as of Sep 30, 2020, the funds from operations (“FFO”) payout ratio increased to 61%, it is still low.
Notably, Alexandria focuses on Class A properties concentrated in urban campuses, primarily for life-science and technology entities. These locations are characterized by high barriers to entry and a limited supply of available space. This highly dynamic setting adds to the productivity and efficiency of tenants, which, in turn, ensures steady rental revenues for the company and high occupancy level of its properties. In fact, 73% of the company’s annual rental revenues comes from Class A properties in AAA locations.
Moreover, Alexandria has adequate financial flexibility to cushion and enhance its market position. The company had $3.9 billion of liquidity as of Sep 30, 2020. Also, the company has minimal debt maturing prior to 2024. Thus, this solid financial position aids the company to hike its dividend and enhance shareholder value.
In the past three months, shares of Alexandria have gained 5%, as against its industry's rise of 2.1%. Alexandria currently carries a Zacks Rank #3 (Hold).
City Office REIT, Inc.’s (CIO - Free Report) Zacks Consensus Estimate for current-year FFO per share moved 5.3% north to $1.20 in a month’s time. The company carries a Zacks Rank of 2 (Buy) at present.
Community Healthcare Trust Incorporated’s (CHCT - Free Report) FFO per share estimate for the ongoing year has been revised upward by 1.1% to $1.86 over the past month. The company carries a Zacks Rank of 2, currently.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
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Alexandria (ARE) Rewards Investors With 3% Dividend Hike
Alexandria Real Estate Equities, Inc. (ARE - Free Report) recently announced a 3% sequential hike in fourth-quarter 2020 cash dividend. The company will now pay a dividend of $1.09 per share, up from $1.06 paid in the third quarter. The increased dividend will be paid on Jan 15, 2021, to shareholders of record as on Dec 31, 2020.
Based on the increased rate, the annual dividend comes to $4.24 a share, resulting in an annualized yield of about 2.5%, considering Alexandria’s closing price of $171.04 on Dec 7.
In fact, solid dividend payouts are arguably the biggest enticement for real estate investment trusts’ (“REIT”) investors. Alexandria also remains committed to that and its common stock dividend for 2020 indicates a rise of 6% over the year ended Dec 31, 2019.
Further, earlier this June, the company announced a 3% sequential hike in second-quarter dividend to $1.06. These dividend hikes reflect Alexandria’s continued efforts to boost shareholder wealth.
Per management, the hike in dividend is in sync with the company’s strategy of sharing growth in cash flows from operating activities with the stockholders, while also retaining a significant portion to reinvest in its strong development and redevelopment pipeline that consists of new Class A properties. Although, as of Sep 30, 2020, the funds from operations (“FFO”) payout ratio increased to 61%, it is still low.
Notably, Alexandria focuses on Class A properties concentrated in urban campuses, primarily for life-science and technology entities. These locations are characterized by high barriers to entry and a limited supply of available space. This highly dynamic setting adds to the productivity and efficiency of tenants, which, in turn, ensures steady rental revenues for the company and high occupancy level of its properties. In fact, 73% of the company’s annual rental revenues comes from Class A properties in AAA locations.
Moreover, Alexandria has adequate financial flexibility to cushion and enhance its market position. The company had $3.9 billion of liquidity as of Sep 30, 2020. Also, the company has minimal debt maturing prior to 2024. Thus, this solid financial position aids the company to hike its dividend and enhance shareholder value.
In the past three months, shares of Alexandria have gained 5%, as against its industry's rise of 2.1%. Alexandria currently carries a Zacks Rank #3 (Hold).
Stocks to Consider
Extra Space Storage Inc’s (EXR - Free Report) Zacks Consensus Estimate for 2020 FFO per share moved up 1% to $5.03 over the past month. The company currently sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
City Office REIT, Inc.’s (CIO - Free Report) Zacks Consensus Estimate for current-year FFO per share moved 5.3% north to $1.20 in a month’s time. The company carries a Zacks Rank of 2 (Buy) at present.
Community Healthcare Trust Incorporated’s (CHCT - Free Report) FFO per share estimate for the ongoing year has been revised upward by 1.1% to $1.86 over the past month. The company carries a Zacks Rank of 2, currently.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>