Summary
Shares yield 7.2% with 129% coverage.
Sears, K-Mart and Toys 'R' Us bankruptcies are actually a long-term benefit due to high rent from new tenants.
Guidance raise offers further evidence that the retail apocalypse is overstated.
What Kimco Has Been Doing
Image from finviz.com
For the past few quarters, Kimco Realty (KIM), like other retail REITs, has been solidifying its portfolio by focusing on quality rather than quantity. Capital recycling through dispositions and cap ex spending to improve existing properties has resulted in higher liquidity and a promising return to growth in the near future.
An example of KIM’s type of properties - image from KIM investor website
YTD lows in late April alongside other REITs, especially in retail, recovered nicely as earnings rolled in and showed better than expected numbers. After a summer honeymoon, higher interest rates and a spooked market have led us to again appear oversold. While KIM shot up ~6% on the most recent earnings call on the 25th, shares are still cheap.
