I’ve been doing some stock research on the Canadian side and have been doing a little in the REIT sector and generally finding very little. However, of note was this press release from BTB REIT (TSX: BTB.UN) which caught my attention. Note the bolding of font below is theirs and not mine:
BTB’S payout ratio stronger than ever!
MONTREAL, Aug. 13, 2013 /CNW Telbec/ – BTB Real Estate Investment Trust (TSX: BTB.UN) (“BTB” or the “Trust”) releases today its financial results for the second quarter ended June 30, 2013, and announces the following highlights:
HIGHLIGHTS OF THE SECOND QUARTER OF 2013
66 properties
Over 600 tenants
4.5 million sq2 of leasable area, rental income growth of 24%Improvement of:
Payout ratio to 76.7% from 92.5% in 2012
Weighted average contractual rate for mortgage loans payable, from 5.15% to 4.67%
The message here is “Our payout ratio is higher, invest in us!”
I will leave it as an exercise to the reader why I would not invest in BTB.
I did not read the release but I read your post, but are not they saying that the payout ratio is lower due due to stronger / higher funds from operations?
Hi Sami,
I’m embarrassed to say that I completely mis-read the press release (I’ll admit to skimming it myself) and see that the current payout ratio is lower (hence “stronger”).
That said, investing on payout ratio is like investing on dividend yield only – has nothing to do with the underlying ability of the entity to generate cash, which is pretty much the only thing that matters in the end run. I generally do not invest in companies that use press releases for promotional purposes.