Q: Hello 5i team,
Do you still see a positive future for CAR.UN? Could you please indicate whether their distributions are eligible for the dividend tax credit?
Many thanks!
Do you still see a positive future for CAR.UN? Could you please indicate whether their distributions are eligible for the dividend tax credit?
Many thanks!
5i Research Answer:
The taxation of distributions can vary a bit each year. Last year, about 50% was taxed as capital gains, and 50% as 'other income'. A negligible amount was classified as eligible dividends. We like the stock; the company is one of the largest and best-managed residential REITs in Canada. Because of this, it has a premium valuation and thus a lower yield than peers (3.39%). But we would rather pay more for quality than less for mediocrity.