PINE - Alpine Income Property: Double Digit Upside But Tenant Portfolio Could Be Improved (Downgrade)
2024-06-21 18:13:01 ET
Summary
- Real estate has been heavily suppressed by interest rates. This has revealed which REITs are well-managed, like Alpine Income Property.
- PINE's price remains below pre-pandemic levels, but the 7% dividend yield offsets poor performance.
- PINE's portfolio has strong tenants but shows some vulnerability with its majority exposure to Walgreens.
- The dividend remains well-covered by FFO per share. The strong coverage can also indicate that future raises are a probability.
Overview
Real estate has been heavily suppressed over the last two years due to elevated interest rates. While this hasn't been great for returns, it has helped reveal which REITs are well-maintained and of higher quality. Alpine Income Property Trust, Inc. ( PINE ) remains a solid option for high-quality real estate exposure as they own a portfolio of commercial net lease properties. However, there are some vulnerabilities that stand out to me and make me reconsider my prior strong buy rating. I previously covered PINE back in August 2023 and would like to provide an updated valuation, review of their portfolio, and cover the financial strength. Most importantly, I want to cover some points that make me a bit less enthusiastic about PINE going forward....
Alpine Income Property: Double Digit Upside But Tenant Portfolio Could Be Improved (Downgrade)