Allied Properties Real Estate Investment Trust

Sound bite for Twitter and StockTwits is: Dividend Growth REIT. Most testing shows that this REIT is on the expensive side as it is testing above the median. See my spreadsheet on Allied Properties Real Estate Investment Trust.

I do not own this stock of Allied Properties Real Estate Investment Trust (TSX-AP.UN, OTC-APYRF). Since several stocks that I followed in 2015 were deleted from the stock exchange, I was looking for other stocks to follow. I am sure that I got this from a Canadian Dividend site called Think Dividends, but I cannot find it at present.

This REIT is not growing the Revenue per share well. Outstanding shares have grown by 7.7% and 14% per year over the past 5 and 10 years. This is a lot. The Revenue appears to be rising well as it has grown by 10.16% and 14.64% per year over the past 5 and 10 years. However, the real growth in Revenue is that shown by Revenue per Share grown which is at 2.27% and 0.58% per year over the past 5 and 10 years. The 5 year running average growth for Revenue per Share is better at 2.18% and 4.23%, but not nearly as good as shown by Revenue.

Dividend yield are moderate to good and the dividend growth is low. The current dividend at 3.80% is moderate, but the 5, 10 and historical median dividend yields are in the good range at 4.05%, 4.57 and 5.72%. Dividend growth over the past 5, 10 and 14 years is low at 2.39%, 2.04% and 4.51%.

You would expect growth in distributions from REITs to be at or slightly above the rate of inflation. The Banks of Canada says that inflation is running under 2% currently. So this would suggest that the dividend growth for the past 5 and 10 years is fine.

The long term total return has been good with this REIT. The total return for the past 5m 10 and 14 years is at 9.02%, 12.37% and 15.30% per year. The portion of this total return attributable to capital gain is 4.98%, 7.33% and 8.84% per year. The portion of this total return attributable to distribution is 4.04%, 5.04% and 6.46% per year.

The 5 year low, median and high median Price/Earnings per Share Ratios are 8.42, 9.29 and 10.38. The 10 year ratios are 8.94, 10.16 and 11.49. The historical ratios are 12.68, 14.26 and 15.85. Since the historical ratios take us over the C GAAP/IFRS accounting divide, this might account for the change in P/E Ratios. The current P/E Ratio is 14.67 based on a stock price of $41.07 and 2018 EPS estimate of $2.80. This stock price testing suggests that the stock price is expensive.

Since this is a REIT I want to look at Price/Funds from Operations also. The 5 year P/FFO Ratios are 15.24, 16.73 and 18.43. The 10 year ratios are 14.23, 16.37 and 18.21. The current P/FFO Ratio is 17.70 based on 2018 FFO estimate of $2.32 and a stock price of $41.07. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a Graham Price of $44.65 based on FFO. The 10 year low, median and high median Price/Graham Price Ratios are 0.77, 0.89 and 0.98. The current P/GP Ratio is 0.92 based on a stock price of $41.07. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a 10 year median Price/Book Value per Share ratio of 1.09. The current P/B Ratio is 1.08 based on Book Value of $3549M, Book Value per Share of $38.19 and a stock price of $41.07. The current P/B Ratio is some 0.9% lower than the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The historical median dividend yield is 5.72%. The current dividend yield is 3.80% based on dividends of $1.56 and a stock price of $41.07. The current dividend yield is some 33.6% lower than the historical median. This stock price testing suggests that the stock price is relatively expensive.

The 5 and 10 year median dividend yields are 4.05% and 4.57%. The current dividend yield is some 6.2% and 16.9% below these yields. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The 10 year median Price/Sales (Revenue) Ratio is 7.26. The current P/S Ratio is 8.62 based on 2018 Revenue estimate of $443M, Revenue per Share of $4.77 and a stock price of $41.07. The current P/S Ratio is some 18.6% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median and close to expensive.

When I look at analysts' recommendations I find Buy (8) and Hold (3). The consensus would be a Buy. The 12 month stock price consensus is $44.23. This implies a total return of $11.49% with 7.69% from capital gains and 3.80% from distributions.

Jacob Donnelly of Motley Fool thinks that this is a must have REIT. Kayla Ward on Simply Wall Street likes this REIT's ROE. Ivanka Thompson of Bangalore Weekly talks about recent analysts changes. See what analysts are saying about this stock on Stock Chase. They seem to like this REIT, but say it is not cheap.

Allied Properties Real Estate Investment Trust is a closed-end real estate investment trust. It owns, manages and develops urban office environments for business tenants operating in Canada. Its web site is here Allied Properties Real Estate Investment Trust.

The last stock I wrote about was about was RioCan Real Estate (TSX-REI.UN, OTC- RIOCF)... learn more. The next stock I will write about will be H & R Real Estate Trust)... learn more on Tuesday, March 7, 2018 around 5 pm. Tomorrow on my other blog I will write about Dividend Stocks March 2018... learn more on March 6, 2018 around 5 pm.

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.