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NorthStar Realty Finance Corp. Message Board

  • rbgambler99 rbgambler99 Nov 5, 2008 11:08 AM Flag

    Question for the board...

    I have NLY and SFL as my high yield income and future appreciation stocks....I have looked at NRF, and other stocks mentioned here, and I just don't see the merit in buying any REITS right seems to be an area that will continue to be squeezed going forward, and if deflation continues, which I think it will, many of these small REITS will be financially strapped and possibly go under...I am no expert, and thats why I post my concerns....please advise as to why all of you think NRF or REITS in general are a good investment going forward...I just don't see it....


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    • As far as I am concerned I think that NLY is as close to a perfect investment as you can get. NRF doesn't come close.
      I own both.
      (NRF has announced that the dividends being paid this Friday will be half in cash and half in dividends.)
      But I don't think that we will have to worry about deflation for much longer. With the Treasury printing money like it were Monopoly Money we will soon be seeing inflation.
      As long as the Fed keeps the rate down so low NLY will continue to make money. As a REIT they have to pay out 90% of their earnings.

    • You can't analyze securities as a group, there are hard asset REIT's, security REIT's and hybrids like NRF. And within those groups there are companies that suck and those that don't. The reason NRF is so cheap at the moment is not that it sucks, it's because all companies in the mREIT sector got slammed unmercifully without regard to quality. NRF at one point could have written a check for its entire common float, it was literally on sale for cash.

      There were (and are to some extent) four high-yield asset classes out there with unbelievable yields, and solid companies in each of the classes; BDC's, MPL's, REIT's and fixed income securities, like preferred stocks, publicly traded notes and closed-end funds. There are people on this board, myself included, who have sifted each of the classes extensively to come up with the companies that will survive, NRF being the #1 primo example, given its cash hoard and the credit worthiness of its holdings. Aside from an almost universal agreement on NRF (for damn good reason), each of us champion different companies, but at least you can benefit from the work that's been done.

      Do your own dd from there, the financials of these companies, their conference calls, opinions good and bad, are all just a few clicks away. Based on my own research I have made my selections and published them here, so have many others. You don't need to question the board, read the board. And also the boards at NLY, RAS and ACAS get a lot of intelligent traffic (and some not so).

    • All good points. I too am looking at NRF and other REITs, but especially NRF and asking myself where are they going to invest in order to grow the business. You cant just make the spread and have no growth. However, NRF management is quite savy and saw this coming a while ago. Wait till tommorrow's CC and see what they say. I am long, but will not get out until I am 100% sure that they cannot provide an adequate return. I think the authorization to buy back shares speaks volumes, or its a clear indication they have no other avenue for the cash right now.

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