BNL - An Unwarranted Discount Gives Broadstone An Accidental High Yield
2024-01-29 13:18:35 ET
Summary
- Broadstone Net Lease, Inc. offers a high dividend yield with strong properties, balance sheet, and management, suggesting above-market total returns.
- The company has a diversified property portfolio with long-term leases and favorable timing for industrial acquisitions.
- Broadstone Net Lease's acquisition process, balance sheet, and valuation indicate that it is trading below fair value, potentially due to dividend stocks being out of favor and the tone of conference calls.
In an efficient market, high-yield equities would share certain characteristics. The oversized dividend yield would be compensation to investors for some sort of fault which most often takes one of the following forms:
- High risk.
- High payout ratio.
- High leverage.
- Weak management.
- Weak growth prospects.
If the market is efficiently priced, the fault of a given company would reduce the capital gains portion of return such that the total return of the company is in line with that of the market despite the high yield....
An Unwarranted Discount Gives Broadstone An Accidental High Yield