Investment Q&A

Q: Hi 5i guys. NXR (Nexus industrial reit) is now truly an industrial reit since they have sold almost all of their non-industrial properties. At the current price of around $7.77 per unit nexus has a yield slightly above 8 per cent!! In the past couple of years nxr's yield has been higher than their cash flow which is concerning, but the past quarter I believe their payout ratio was around 97 per cent (please confirm). They have a couple of new properties that should be contributing to cash flow and apparently they are releasing properties at much higher rates. Based on that I believe they should be able to continue with the generous yield since the payout ratio should slowly improve. What concerns me is the cost of their debt. They have to refinance a portion of the debt this year and next. The debt they are rolling over was at very low rates and the new rates are at least one per cent higher. Can your bloomberg terminal give an estimate of how much more interest NXR will have to pay on their new debt? If you can make a query as to whether the increasing of rent (and new property rent) will more than offset higher interest payments would be appreciated as well (I am not sure how sophisticated a Bloomberg terminal can be.) I was fortunate that last summer I rotated some tech into precious metal miner and now I want to pay it safe and reduce the PM miners with some income plays. NXR got on my radar. My only other reit exposure is a small position in Granite reit. Thanks for your help and I wish I had a Bloomberg terminal!!

Q: Appreciated your recent report on DIR. I am a long-term holder, and always thinking of adding more. It does seem to have been a bit challenged in the last year or two, and wondering how that compares to its' peers in industrial warehousing? Your report lists the peers as Prologis, yes, but also StorageVault (which I thought was primarily personal storage units) and Riocan, which is primary retail. What am I missing? Aren't there other industrial warehousing companies you can use for a more accurate comparison?
Thank-you

Q: For a dividend account, in what order would you acquire and at what price. Thanks

Q: Hello 5i

I already own DIR for the dividend. Which is the better choice: adding to NXR with a higher dividend or just adding to my existing DIR holdings?

Thanks guys
Ken

Q: How would you rank the following reits (AP.UN, DIR.UN, HOM.UN, MHC.UN, MI.UN, NXR.UN, PLZ.UN, PMZ.UN and REI.UN) for total return. Are they any you would not buy or would only buy a partially at this time?

Q: Currently hold PBH and considering selling. Know you recently rated as a hold for the three year period. For a better total return,over the next three years, would you sell PBH and buy one of ATH, CJT, MG, NPI, NXR.UN, TCL.A, or VHI. Please rank these stocks for purchasing. Thanks

Q: I own Nexus.un and btb.un and I drip them monthly.

Can you please comment on their latest earning reports with REIT related metrics and on future guidance ?

Thanks,

Q: Can you please comment on Nexus Industrial REIT third quarter 2024 financial results and on their payout ration, dividends safety, expected growth, and in relation to piers, etc. Thank you.

Q: Good morning,

can you please share your thoughts on BTB.un and NXR.un, their recent financials including any going forward comments you may have, payout ratio and future growth based on the interest rates moving downward.

I'm in love with the monthly dividends and I have been dripping both stock, my position in both is starting to be central in my portfolio.

Thank you

Q: Can you please review their recent financials and suggest if the dividend looks safe or a cut may be coming ?
If you already have a small (1/3) position would you add more ?

Q: Hello, I have the following in my TFSA: GIB.A, OTEX, NVEI, KXS, DSG, DOL, NXR.UN, with more or less the same weight. I am under water with NVEI, KXS, NXR.UN. Should I just sell OTEX, DSG and GIB.A and buy XIT instead and wait for NVEI and KXS to break even before selling them and buy XIT? I know XIT has 50% in SHOP and CSU and 5i likes CSU very much. I am less sure about SHOP. What is your opinion of SHOP for a long term hold? I did not fully understand their recent change of strategy. FYI, I have US tech names in a cash account, that’s why I am looking at CDN names in my TFSA. Thanks.

Q: I have had good success with industrial reits, having held DIR.UN for several years, and having 2 other industrial reits bought out over the years with nice profits. And then there's NXR. A more recent purchase and clearly a mistake, as it is currently the highest percentage loss in my portfolio (fortunately a small holding: only about 1% - but was about 1.5% initially). Question - do you see any hope for this one, or better to just move on now that it has shown a little strength? This is in an RSP, so the loss can't be claimed. I would like to take advantage of the current relatively high yields in some better-quality names to hopefully make my RSP a little less prone to this kind of loss.
Thank-you

Q: I have a follow-up question to my Oct 26th question asking what are the 3 most important ratios to use when evaluating REITS. Your response to my initial question was "We would consider debt ratios (debt to value), with caution above 55%, cash flow to interest, with caution below 2X, and dividend payout ratio, with caution above 80%. Book value can be important but is often over or under-stated and needs to be looked at carefully. Valuation metrics (price/cash flow) are also important."

For NXR.un you calculated those ratios as NXR.UN 48%, 97.1%, 1.6X.

Is the Dividend Payout ratio calculated after the interest payment? If not, does that mean these companies are taking on debt to pay either the interest or dividend?

Q: Fortunately I sold PRV.un and NXR.un over a year ago and now wondering if it is time to repurchase. I'm reminded of Warren Buffet's expression to be "greedy when others are fearful" and there is lots of fear out there at the moment. In your opinion, what are the three most important ratios when evaluating REITs and what are the yellow (caution) the RED (danger) zones for those ratios? What are the ratios for the subject REITS?

Q: Could you compare DIR.UN and NXR.UN?

Q: AT THIS TIME,IS NEXUS INDUSTRIAL REIT A BUY? IF IT IS A BUY, WHAT ARE THE REASONS TO BUY?

Q: Hi, I would appreciate your thoughts regarding Nexus Industrial REIT. It's my understanding that this REIT has effectively transitioned from a mixed properties REIT to a more purely industrial REIT, in recent years. Can you confirm if that is your belief as well? In reviewing the firm's dividend history, it looks to me as though they may have increased their monthly dividend by 300% in Feb/Mar of 2021, from a payment of $0.01333 to $0.05333. Is that correct? Does the REIT generate sufficient cash flow to cover its current dividend and are you please able to provide your opinion about how "secure" the current dividend might be, going forward? Lastly, do you have any information regarding the REIT's current debt and how much of that debt may be of a variable rate and/or due to mature and need to be refinanced over the next year or two? I'd be personally worried about the sustainability of the dividend if a large amount of very low interest debt were to need to be refinanced at what I'm hoping are temporarily much higher rates of interest. It' my opinion that interest rates might be half of what they are today, within two years time from now. Thank you!

Q: Early last week I asked a question about NXR.UN. Still I have not received any answer. My question was about your insight about this company, latest results etc. Does the cash flow cover the dividend. There was a similar delay about my question on FCD.UN two weeks ago.
Thanks for your insight

Q: Hello, looking to invest in Nexus Industrial REIT, especially since the drop in price due to a bought deal. I already have DIR.un. In the industrial sector, is this a name you like and if so, why? Thanks.

Q: Q3 results looked steady. Your thoughts plse.

Thanks