Post Properties Inc
Post Properties and Mid-America: Exceptions in the MAE Clause
Pretty much anything that has a material adverse effect on a company will be considered an MAE, although there are exceptions to that rule.
MAE Clause: How Mid-America Could Walk Away from the Deal
We’ll look at the MAE clause of the Post Properties and Mid-America Apartment merger agreement. We’ll see how Mid-America could walk away from the deal.
What’s the Downside in the Post Properties and Mid-America Deal?
Post Properties was trading at ~$62 per share before the deal with Mid-America was announced. If the deal breaks, it could return to those levels.
Why Is Mid-America Apartment Buying Post Properties?
Mid-America Apartment is buying Post Properties (PPS) in a $4.5 billion stock transaction to create the largest publicly traded apartment REIT.
Mid-America Apartment Buys Post Properties in a $4.5 Billion Deal
Post Properties and Mid-America Apartment announced a merger. Mid-America will purchase Post Properties for ~$4.5 billion in stock and assumed debt.
Investing in Post Properties through ETFs
The iShares US Real Estate ETF (IYR) has a 0.39% stake in Post Properties while the SPDR Dow Jones REIT ETF (RWR) has a 0.55% exposure.
What Post Properties’ Higher-than-Average EV-to-EBITDA Multiple Means
Post Properties’ EV-to-EBITDA ratio is in line with its historical valuation, ranging between 12.2x–25.5x, with a current EV-to-EBITDA ratio of ~21.7x.
Assessing Post Properties’ Average Price-to-FFO Multiple
Post Properties’ TTM price-to-FFO multiple is in line with its historical valuation at around 18.9x.
Gauging Post Properties’ FFO Payout Ratio versus Peers
Despite its decline in FFO, Post Properties increased its dividend by 25.8%, reaching $1.56 per common share in fiscal 2014, compared to $1.24 in 2013.
Comparing Post Properties’ EBITDA Margin with Industry Average
Post Properties recorded an EBITDA margin of 51.3% in 2014, which is lower than the industry average of 57.7%.
Why Property Acquisitions and Dispositions Are Important to Post Properties
The principal objective of Post Properties’ acquisition and disposition strategy is to build a high-quality portfolio that garners demand from residents.
Evaluating Post Properties’ Less-Than-Aggressive Property Development Strategy
Like other major apartment REITs, Post Properties believes in generating consistent earnings growth through property development and redevelopment.
A Must-Read Company Overview of Post Properties
Headquartered in Atlanta, Georgia, Post Properties is structured as an REIT and completed its initial public offering in 1993.