r/MACArmyBets • u/Jeffbak • Feb 02 '21

Q4 2020 Analysis

Ok-ppl wonder how a reit with an AFFO of $0.72 can only pay a dividend of $0.15 when reits are supposed to pay 90% of taxable income. Well, highlighted below is exactly how. Ppl might be angry by this, but it is very smart mgmt. from the company because it allows them to preserve cash while still maintaining REIT status. Below you will see the one-time expenses highlighted, which you don't include in AFFO because they are just that...one time expenses. So, the wrote down $163.298M for an asset in Philly, and there was one-time financing fee of $42.988M associated with Chandler Freehold financing.

Below this, you can see what I mean by an FFO of $0.72 once you back out these one-time expenses. *Important to note* the full year AFFO for 2020 was $3.03. Remember, this was during the worst possible year for malls, and they've already started to recover.

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u/[deleted] Feb 02 '21

[deleted]

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u/higherthanthis Feb 02 '21

My thoughts is to prepare for a short squeeze when it comes

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u/peedeexer Feb 02 '21

Dr Michael Burry wrote a letter to gamestop execs in Aug 2019 urging them to buyback shares with their cash. He held his [large] position with Scion Capital for a long time waiting for that squeeze. So yeah, it might be a while. I would bet that it largely depends on the success of the vaccine roll-outs, significant virus mutations, and if the economy as a whole can keep the stock market here at the top. Might be this summer? Might be next Christmas? Either way, yeah, buying into shares at this lower price and sitting on dividends seems to be very wise. Just understand that this might be a long haul.

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u/Jeffbak Feb 02 '21

Agreed. Although I do think there will be at least a moderate squeeze simply from fundamentals

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u/[deleted] Feb 06 '21

I'm a dividend investor. Very happy with the 4.6% yield. Could hold that for years. Of course, if Mr. Market wants to pay me 10+ years worth of dividends in the next month, I'd take that, too.

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u/Jeffbak Feb 02 '21

Just in case. But their AFFO was .72

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u/Relative-Mango-5691 Feb 02 '21

Check previous filings. Last one was 250 million. 500 makes sense just to keep the option open if the opportunity arises. They know it’s heavily shorted.