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Strategies & Market Trends : The Contrarian's Corner

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To: Elroy Jetson who wrote (82)	9/22/1998 1:30:00 PM
From: deeno	Read Replies (1) of 113

I agree with both previous comments. I am not so worried about "value" of the real estate (since it seems reits rarely sell), but agree that there has to be enough dividend cushion in the cash flow to weather a recession (if indeed we have one, the contrarian view). So it seems that the REITs sector are out of favor for all the reasons listed in fact most of the REITS are already down 30%+. So if you find a REIT that can weather a recession, keep or improve on the dividend for stablility, in a sector that has been killed already, that might produce a contrarian idea. It is expected that the higher quality REITs agree that things are slowing down and that new real estate opportunities (ie CAP rates) are over inflated so they find BUYING back their own stock at current prices is buying cheaper than putting on more properties. Couple this with a company 30% or more owned by insiders and you have alighned management with shareholders. These opps are out there I'm still looking. Keep that input coming :-) Remember... You cant buy stuff cheap if everyone love it. Deeno

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