NLCP - NewLake Capital Partners: A Cannabis REIT Worth Considering

2024-02-17 08:30:00 ET

Summary

• NewLake Capital Partners is a cannabis-focused real estate investment trust that leases properties to operators in the industry.
• The company has experienced a decline in share price, but the cannabis industry is projected to see significant growth in the coming years.
• NewLake has solid dividend coverage, low debt, and is currently undervalued, making it a potential long-term investment opportunity.
• Like peer Innovative Industrial Properties, the REIT also had trouble throughout the year with rent collection from two of its tenants, causing revenue to decline by 4.9% year-over-year.
• Due to their current tenant troubles and uncertainty surrounding the sector, I rate the stock a hold currently.

Introduction

During 2021 cannabis stocks were the new hot ticket item in the market, but since then the burning fire surrounding them has seemed to cool. In turn, this has caused many of them to trade at attractive valuations currently. Especially, if you believe in the long-term outlook on the industry....

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