Timberland and Farmland Go to the Front Burner

sampleThe acquisition of Plum Creek and the strong results of Farmland Partners have positioned both companies as the best-performing REIT stocks of the week. Once a neglected sector in 2015, timberland and farmland have quietly stolen the show in this next to the last month of the year.

The merger of Weyerhaeuser and Plum Creek (which became more of an acquisition of Plum Creek by Weyerhaeuser due to the ownership ratio between the companies) has benefitted Plum Creek shareholders, who will receive the same dividend rate as Weyerhaeuser shareholders–which represents a 13 percent bump in the dividend. Plum Creek shares spiked by 17 percent following the acquisition and slightly decreased for the remainder of the week. On the other hand, Weyerhaeuser shares dropped 4 percent last week and 19 percent year-to-date.

Farmland Partners released their third quarter results which showed a whopping 101 percent increase in their year-to-date Adjusted FFO per share. The company bought a large tract of land in Illinois which gives them a third increase in acreage. Following the announcements, Farmland shares went up by 6 percent.

These two REITs shine in a week where more than 85 percent of the REIT stocks pulled back. The 175 equity REITs we track have decreased by 2.6 percent, especially Regional Malls which as a whole have suffered more than others. Retailer results have been disappointing for companies such as J.C. Penney, Macy’s, and Nordstrom. Rouse Properties and Macerich Co. dropped by more than 10 percent, mostly on Friday.

Download our free US equity REIT Report

Weyerhaeuser (NYSE:WY); Plum Creek (NYSE:PCL); Farmland Partners Inc. (NYSE:FPI); Macerich Co. (NYSE:MAC); Rouse Properties (NYSE:RSE); Nordstrom Inc. (NYSE:JWN); Macy (NYSE:M); J.C. Penney Company Inc. (NYSE:JCP)

Disclaimer: This newsletter is not engaged in rendering tax, accounting, or other professional advice through this publication. No statement in this issue is to be construed as a recommendation to buy or sell any security or other investment. Please do your own due diligence before making any investment decision. Some information presented in this publication has been obtained from third-party sources considered to be reliable. Sources are not required to make representations as to the accuracy of the information, however, and consequently the publisher cannot guarantee accuracy.

Disclosure: The author has no positions in any shares mentioned, and no plans to initiate any positions within the next 72 hours.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s