He says DLR is going to the market to "fund its yield".
Does he understand how REITs work? REITs go to the markets to fund their GROWTH. It's the only way they can grow since they are legally required to pay out 90% of their taxable income. Most REITS are constantly going to the markets. And ignoramuses keep calling them "Ponzi schemes". Fact is, they use their new capital to buy more real estate, not to "fund their yields".
MLP's do the same thing (guess that is why he faults LINE). I hate these shorts that get publicity and trash stocks either so they can cover a short or buy in lower for the next run up. I hope DLR is better than he lets on.
You are right. The guy who shorted this is an idiot...He said there are no barriers to entry. I guess he doesn't realize it costs about $1,500psf to build these centers, not to mention they own the real estate. His comments are negligent and DLR should sue him for making such comments. He should look at the 10 year chart on this stock and the consistency of the growth and dividend....On the flip side, I was hoping the stock dropped a bit more so I could add to my position. Good luck to all who are long DLR!!! Those shorts will have to cover sooner or later and since there is a 15 day coverage (based on avg shares traded) we are looking at a nice pop once these folks pull their head out of there #$%$.
I've only owned this a couple of months but I've seen this same basic argument come up again and again with BDCs, MLPs, and any other company that by design pays out a high % of cash. It should be pretty easy for IR to demonstrate over last couple of years X dollars raised in capital markets vs Y dollars spent on acquisitions and debunk it.