This Strong Buy REIT Is Just What The Doctor Ordered
- I picked these STRONG BUY names because I believe they will eventually outperform and deliver satisfying returns.
- It’s important for these REITs to demonstrate durability and this means they must meet a high threshold for inclusion.
- It make take a few more quarters, but eventually I believe my STRONG BUY pick will pay off.
I recently commenced an All-STRONG BUY portfolio called “The New Money Portfolio” and the purpose for this basket of stocks is to capitalize on the REITs in which I have the highest conviction. Keep in mind, I am not anticipating instant success with my “New Money” portfolio, as many of the picks will take time to materialize.
Nonetheless, I have been pleased with the progress being made, and especially my top 5 performers: Jernigan Capital (JCAP), Urstadt Biddle (UBA), Ventas, Inc. (VTR), EPR Properties (EPR), and Park Hotels (PK).
I am constantly looking for new entrants to the “New Money” portfolio, always mining for value, and REITs that exhibit a wide margin of safety. Simultaneously, I am continually examining the depth of the bench, the prized possessions that are anxiously waiting to unleash their raw talent.
I picked these STRONG BUY names because I believe they will eventually outperform and deliver satisfying returns – I target 25% annual returns for these REITs, so there is very little guess work that comes into play.
It’s important for these REITs to demonstrate durability and this means they must meet a high threshold for inclusion. Before I provide these REITs with an All-Star Team Jersey, I always ask the following questions:
- Can the company be as profitable as the peers?
- Can the company grow over the next 2, 3, and 5 years?
- How does the balance sheet compare?
- What is the moat, and how wide is it?
- How safe is the dividend?
- What are the catalysts that drive the prospective 25% return target?
Sometimes it takes time for the players to warm up, and while I am pleased to see PK, JCAP, EPR, VTR, and UBA begin to score, I remain bullish that, as a coach, the less-popular players will begin to exhibit strong performance.
As you can see, Physicians Realty (DOC) is one of the STRONG BUYs in the “New Money” portfolio that is still warming up. I recently upgraded this REIT to a STRONG BUY (on March 5th) and the company recently announced Q1-18 earnings results.
Based on my previous scouting reports, DOC has all of the ingredients to drive, shoot, dribble, and dunk. It’s now time to evaluate the most recent news in an effort to determine if DOC will become a prime-time-player…