Recent Purchase: Plaza REIT


I usually make one purchase per month. One of my key principles of investing is value and stable dividends. Before I buy something new, I like to analyse my own portfolio to see if there are any stocks on sale.

Setting a Target Price
I kept on eye on Plaza REIT since the March of 2017 when it started to drop below $5 dollars. I set myself a target price. If it drops below $4.50 I will be a buyer. PLZ became very attractive when it dropped below $4.50 and I took advantage of it.


Reasons for the Drop

I can name a few reasons why the stock fell to those levels. The market is negative about retail businesses, interest rates are going up, and the technical support is broken. I could be wrong, but this is how I see it.


Fundamentals are Strong

However, the fundamentals of the company are very strong. They lease their spaces to great and stable retailers where people shop regularly. They increase value through their development program. They increased their distribution every year for the past 15 years.


Purchase
I already had 230 units of Plaza Reit in my portfolio and I decided to double my position. I bought another 230 units for $4.35 each. I ended up paying for it a $1000. 80% of the purchase was paid by new funds and 20% was paid by dividends. I always reinvest my dividends to grow my portfolio faster.


What Gives?
With the addition of 230 units of PLZ, my dividend income will increase by $5.17 per month or $62.04 per year. That represents a yield of 6.2% and I'm locking it for a long term.


Thank you guys for reading. Feel free to comments below if you have any questions. Feel free to share your recent purchase.




4 comments:

  1. Always nice to see the consistent buying coming along. Never heard of this REIT before though the bloodbath in anything related to retail has certainly given us some better buying opportunities in recent weeks. Thanks for sharing.

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  2. Solid company. Under the radar. Excellent management and complete their development projects without equity dilution.

    I have around 7500 shares and the 3% bonus shares in the DRIP plan is great.

    All the selling is by retailers who sell based on the news articles on Amazon and retail market in the US.

    Good luck.

    Spock

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  3. FCR is another one if you want to invest in retail in urban areas. They are doing huge redevelopment in Yorkville, Toronto

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    1. Hi Spock,

      I'm familiar with FCR. I used to hold shares in that REIT as well. I'm just waiting for a better entry point. Their properties are nice. They recently redeveloped on of their properties in Montreal and it looks fantastic. Good luck!

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