Hot Stock Pick 08-08-08 – PEI

Hot Stock Pick 08-08-08 – PEI
by Zig Noda

PEI – NYSE

Today’s Close: 20.15

Penn Real Estate Trust is an investment company and real estate investment trust that owns and manages over 50 malls, supermalls, and strip malls in the East Coast, primarily Pennsylvania and NJ but all over the US.

They are profitable and have been paying dividends regularly since 1962.

Their dividend payout history was semi annually but now quarterly and at today’s close at 20.15 the yield is over 11%.

Historically about every 5 years or so they have increased their dividend payout.

I have been privately touting this stock to my colleagues for the last week when the price was floating around 18 and the yield was over 12%. In just the last 3 days with the market strength the stock has gone up over 10%.

A 10%+ yield in today’s market is an excellent yield for a company that has historically paid 126 consecutive divendends.

Unlike volatile bank stocks PEI’s average trailing 5 year yield has been over 5%. This is a great stock at a great price with a great opportunity to lock in a great yield with great upside capital appreciation potential.

Even if prices go down with market movement, there is a great opportunity to dollar cost average down and accumulate more shares with a higher yield.

PEI’s “market competitor” is GGP General Growth Properties which does the same type of business. Currently and historically PEI has delivered a much higher yield.

PEI has a stable portfolio of malls that bring in consistent rental receipts from tenants. Furthermore, many mall type rentals are structured on a gross percentage basis so in a slow economy they get their rental revenue, and in a growing economy they get more revenue.

This is a stock that allows you to own a piece of many malls and enjoy a great yield return on investment from a team of management professionals with decades of experience and a proven profitable track record.

This is what I currently consider a HOT A+ stock pick.

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Disclaimer(s) – Trading and investing involves a high degree of financial risk. There is risk of significant financial loss when investing and trading in stocks, futures, options, mutual funds, indices, index options, and other types of financial instruments including but not limited to foreign exchange (Forex) and currency trading. Investing and trading has large potential rewards, but also large potential risks. You must be aware of the risks and be willing to accept them in order to invest or trade in any financial markets. Don’t trade or invest with money you can’t afford to lose. Use risk capital only. Nothing on this website is either a solicitation nor an offer to Buy or Sell stocks, securities, futures, options, indices, mutual funds or any other types of financial instruments. No representations or implications are being made that any account will or is likely to achieve profits or losses similar to those shown. Past performances either actual or hypothetical of any trading system or methodology are not necessarily indicative of future results. The bottom line is that there are no guarantees in trading and investing – it involves financial risk. Leveraged instruments such as futures contracts and selling naked options, and other strategies and financial instruments may involve even a higher degree of financial risk than initially anticipated. Consult with your broker or a professional financial advisor before you invest or trade. Invest and trade at your own risk. You are solely responsible for your investing and trading decisions.

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