“Consensus estimates are calling for FFO per unit to be up 3.7% compared to the same quarter last year on a market cap-weighted basis. Growth is expected to be strong across the majority of the Canadian sub-sectors, notably Seniors and Domestic Apartments , offset by declines in the Diversified space … REITs within our coverage universe are trading at an average 21% discount to NAV and a 12.8x 2024E P/FFO multiple .
Mr. Wilkinson has “outperformer” ratings on Automotive Properties REIT, Brookfield Corporation, BSR REIT, Chartwell Retirement Residences, Crombie REIT, Dream Industrial REIT, Dream Residential REIT, European Residential REIT, First Capital REIT, Granite REIT, H&R REIT, Killam Apartment REIT, Minto Apartment REIT, Morguard North American REIT, Nexus Industrial REIT, Primaris REIT, PRO REIT, RioCan REIT and SmartCentres REIT.
The value picks are Quebecor Inc., Cogeco Communications Inc, Magna International Inc, Canadian Western Bank, Fairfax Financial Holdings Ltd, Crescent Point Energy Corp, Rogers Communications Inc., Baytex Energy Corp, Equitable Group Inc., Great-West Lifeco Inc, Suncor Energy Inc., Pason Systems Inc., Enerplus Corp, iA Financial Corporation Inc and Linamar Corporation. For growth, Intact Financial Corporation, Quebecor, Inc.
“S&P rallied on weaker-than-expected NFP numbers, and this was accompanied with new risk flows on Friday and Monday. However, the net positive increase in bullish positioning was partially offset by some long unwinds witnessed earlier in the week . However, we have yet to see a significant shift in futures positioning that would suggest a material change in sentiment and investors appear at best cautiously optimistic.