- STORE shares have had a brutal 12 months with the stock dropping 33% since July of 2021, well ahead of peers in the net lease sector.
- The market appears to believe that STORE is likely to be disproportionately hurt from a recession and rising interest rates. I believe that this narrative is wrong.
- The company's balance sheet and tenant quality are perhaps the strongest in its history and will enter any recession in great shape.
- With interest rates rising and near-term debt maturities at manageable levels, the company is primed to take advantage of increasing CAP rates and larger contractual rent increases. Tightening credit metrics only increase STORE's value proposition to tenants.
- STORE Capital is a strong buy at current levels and offers a 6%, well covered dividend, along with a path to 11.5% total returns for years to come.
For further details see:
STORE Capital: The Market's Perception Is Dead Wrong