Highwoods Properties Inc. Message Board
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Inevitable Dividend Cut?
It looks like the fourth quarter CAD (53 cents) did not cover the dividend. A cut this year is probably unavoidable. The substantially lower FFO forecast for 2003 means that full year CAD will be substantially lower that the $2.72 for 2002. The earnings report seems to have both positives and negatives. Other than the CAD, other negatives include lower operating income from existing properties. Rentals are being turned over at lower rates and the Worldcom and US Airways situations are still unresolved.
There are some positive points. The company seems to think that they've seen a bottom in their markets and lease activity in the fourth quarter was the highest in awhile. In addition debt has decreased and the company has some cash to redeploy from sale of properties.-
they should cut the div; they keep it because they think too macho
if they hold the div too long, they'll go down in flames like another southern piece of crap - Post Properties, which held its div until it had to cut it over 30 percent
i'd limit the div to the mandatory payout until the economy turns around; use the spare cash to buy back shares at a disc- 3 Replies to token_gentile
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...down in flames...
Keep in mind the trouble from worldcom & u s air was priced in the end of 2002...no doubt resulting in the dip.
Also as these tentants are replaced(i think we're already seeing this in improved leases this qrt.)HIW will be paying a HIGHER dividend because of increased R.E. values reflecting in higher rents. Be sure this won't happen at once.
I'll be back. But in closing I'll remind you of the three MAIN things when investing in Real Estate...LOCATION, LOCATION, LOCATION. Do you know what the 'sun-belt' is? Anyway I'll be back.
AAHHhhh HHAAaaa Hhhaa all the way to what? -
Cut the div ; use the cash to buy debt on the cheap; use extra cash to buy back stock
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Freddiefor What do you think about the possibility of a dividend cut? I think it will hold for 2003 but if things don't get any better in 2004, the dividend could be cut in 2004?
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