Portfolio Update – 07/14/2017

I’ll kick this site off by giving a quick look into my current holdings. I know my current holdings are rather weakish, however, I had to start somewhere. I’ve been rather passive on my recent investing habits, but that is going to change. I am developing a realistic and passive financial-plan to invest more heavily into dividend stocks, which I’ll write about soon.

Here is my current portfolio snapshot (yes, it’s currently only one stock):

Stock Ticker: ABR – Arbor Realty Trust (REIT)

Currently: 179 Shares, purchased @ $8.30 w/ Yield @ 8.75%

Total Cost: $1,485.70

Estimated Annual Dividend: 128.88 / Quarterly: 32.22

 

Why REIT’s?

I did a lot of research into REIT’s, and I really liked what I found. First of all, they are income-producing real estate companies that pay out at least 90% of their profits as dividends. They also have very solid overall performance. Despite the 2007-08 real estate market crash, they’ve generated a 14% annual return. That is better than the S&P 500’s return between the same time period, which was only 12%.

But as with everything good, there is always a downside. The dividends paid by REIT’s are subject to taxation as ordinary income, not capital gains tax. So, if you’re in a high tax bracket, this may not be favorable. However, in my current position, it is still beneficial. Secondly, REIT’s are known to be volatile, often acting with non-traditional market behaviors. However, as an investor, ups and downs shouldn’t be all that concerning. We are in it for the long haul, reaping those delicious dividend rewards.

Why Arbor Realty Trust?

It’s shown decent and promising growth reflected in the financial reports, along with solid fundamentals such as assets, net profits, liabilities, etc. Numerous analyst’s have concluded that ABR is undervalued, and has tremendous growth potential. Ivan Kaufman, the CEO is personally heavily invested in the company, which I always see as a good indicator of the company’s overall promising future. With all that aside, what I really love is the cheap price, with the very high yield and it’s growth potential. ABR has shown steady and maintainable growth since it’s bottom in 2009, I believe the company will come back stronger than ever.

Here’s just a chart I grabbed off of capitalcube.com, highlighting ABR’s undervaluation and high earnings momentum.

Earnings Momentum Vs Relative Valuation

As you could see, on the top right ABR-US, ranks high on the Undervalued/High Earnings Momentum chart.

Thanks for reading, I’ll provide more updates soon, just thought I’d provide a little insight into what I’m working with so far. Thanks for reading.

-Andrew

 

Also, if you’d like to sign up for my newsletter, that would be great. I’ll try to provide some useful information, updates to my blog, and some give-away’s.

 

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