REITs have been under pressure this year
The major stocks in the top five REIT subgroups that saw positive returns over the week ended July 17 are real estate services REIT Realogy Holding (RLGY), specialized REIT Out front Media (OUT), residential REIT Home Properties (HME), diversified REIT St. Joe (JOE), and retail REIT Macerich (MAC). These five stocks earned an average 1.15% return in the second week of July 2015.
Out of the total of 114 stocks in the IYR ETF, only seven stocks earned positive returns that week. However, in the last year, 54 stocks have earned positive returns. REITs have been under pressure this year. Over the last year, the average returns on these 54 stocks has been 9.64%, whereas the ETF as a whole earned 0.89% in this period.
The biggest losers in IYR for the week were Lexington Realty Trust (LXP), INVESCO Mortgage Capital (IVR), Spirit Realty Capital (SRC), Xenia Hotels and Resorts (XHR), and Chimera Investment (CIM). They all lost 6.5% to 7% of their stock value.
A total of 35 stocks traded above the 100-day moving average and 37 stocks traded above 50-day moving the average. The average implied volatility that the of all 114 stocks was 23.3. A total of 748 analysts recommended a “hold” rating, followed by 657 recommendations for a “buy” and 124 recommendations for a “sell.” The five-day average volume stands at 9,524,999, which was a fall from the previous five-day average of 10,651,802.
The curious case of the St. Joe Company
The St. Joe Company (JOE) has seen an unexpected increase in returns in the last four weeks. The company has beaten the S&P 500 index by 4.67% and has been on a rally since. The St. Joe Company is a Florida-based real estate development company that operates in commercial real estate and resorts, leisure, and residential real estate.
The company recently announced that the Bay-Walton County Sector plan was adopted by Bay County and Walton County. The plan provides the company the right to develop residential units and commercial units on 110,500 acres of land.
Some of the liquid real estate stocks that invest in commercial mortgage-backed securities and residential mortgage-backed securities are CBL & Associates Properties (CBL), the iShares US Real Estate ETF (IYR), Invesco Mortgage Capital (IVR), Capstead Mortgage Corporation (CMO), and Penny Mac Mortgage Investment Trust (PMT).