This is the forum for Growth & Total Return discussion on Seeking Alpha. A new chat begins every two weeks, and all previous blogs are listed in chronological succession on the main chat page. We won’t be doing any comment cleanup in the new chat, and users will always be able to refer back to previous discussions.
More on Today’s Markets:
Robinhood (NASDAQ:HOOD) continues to democratize finance. Yes, that’s a cliché, but the stock tells the story. So far this year, HOOD has returned 227%, compared to just a 14% S&P 500 performance. CEO Vlad Tenev’s company has outshone the Financial Sector ETF (XLF), which is up just 13%. Even the outperforming Broker-Dealers ETF (IAI) doesn’t come close to HOOD.
The REIT often trades at a premium, and at a current P/AFFO multiple less than 16x and offering solid upside potential, I think buying below $30 is a great contrarian opportunity.
Today’s discussion will be a follow-up to our prior discussion of Realty Income Corporation (NYSE:O), the world’s largest net lease REIT by property count and enterprise value. In fact, it’s not even close, as I usually reiterate that O now owns more properties than Agree Realty (ADC), NNN REIT (NNN), W. P. Carey (WPC), Essential Properties Realty Trust (EPRT), and NETSTREIT (NTST) combined. Over time, I have taken to calling O a net lease index fund due to their diverse ownership across property types, geographies, and tenancies.
BIP has been a remarkable compounder of its capital. The company has raised its distributions to unitholders by a 7.3% compound annual growth rate (“CAGR”) over the last decade, higher than its peer group average, with the company’s most recent raise at 6.2% to $0.43 per unit. This is around $1.72 per unit annualized for a 5.12% yield. The C corporation, BIPC, trades higher than the units, as it does not issue a Schedule K-1 tax form, which means a dividend yield of 4.20%. While I also own BIPC for greater upside exposure to the company’s FFO growth profile, liquidity, and mission-critical assets, BIPH offers what I think will be a double-digit total return through to the end of the decade.
The solid financial performance allowed Gold Fields to reduce its net debt to ~$1.06 billion ahead of the $2.1+ billion Gold Road acquisition that just closed. However, if gold prices remain near spot levels, Gold Fields should be able to rapidly de-lever and exit 2026 with a net cash position despite significant dividend payments, benefiting from its sale of Northern Star shares for ~$700 million and its recent sale of shares in Galiano Gold (GAU).
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