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Do Dream Industrial Real Estate Investment Trust’s (TSE:DIR.UN) Earnings Warrant Your Attention? – Simply Wall St

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Like a puppy chasing its tail, some new investors often chase ‘the next big thing’, even if that means buying ‘story stocks’ without revenue, let alone profit. Unfortunately, high risk investments often have little probability of ever paying off, and many investors pay a price to learn their lesson.

If, on the other hand, you like companies that have revenue, and even earn profits, then you may well be interested in Dream Industrial Real Estate Investment Trust (TSE:DIR.UN). Now, I’m not saying that the stock is necessarily undervalued today; but I can’t shake an appreciation for the profitability of the business itself. Loss-making companies are always racing against time to reach financial sustainability, but time is often a friend of the profitable company, especially if it is growing.

See our latest analysis for Dream Industrial Real Estate Investment Trust

Dream Industrial Real Estate Investment Trust’s Improving Profits

Over the last three years, Dream Industrial Real Estate Investment Trust has grown earnings per share (EPS) like young bamboo after rain; fast, and from a low base. So I don’t think the percent growth rate is particularly meaningful. As a result, I’ll zoom in on growth over the last year, instead. It’s good to see that Dream Industrial Real Estate Investment Trust’s EPS have grown from CA$1.09 to CA$1.22 over twelve months. That’s a 12% gain; respectable growth in the broader scheme of things.

One way to double-check a company’s growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. While we note Dream Industrial Real Estate Investment Trust’s EBIT margins were flat over the last year, revenue grew by a solid 34% to CA$220m. That’s a real positive.

In the chart below, you can see how the company has grown earnings, and revenue, over time. To see the actual numbers, click on the chart.

TSX:DIR.UN Income Statement, December 22nd 2019

While it’s always good to see growing profits, you should always remember that a weak balance sheet could come back to bite. So check Dream Industrial Real Estate Investment Trust’s balance sheet strength, before getting too excited.

Are Dream Industrial Real Estate Investment Trust Insiders Aligned With All Shareholders?

Like the kids in the streets standing up for their beliefs, insider share purchases give me reason to believe in a brighter future. Because oftentimes, the purchase of stock is a sign that the buyer views it as undervalued. However, insiders are sometimes wrong, and we don’t know the exact thinking behind their acquisitions.

It’s a pleasure to note that insiders spent CA$4.4m buying Dream Industrial Real Estate Investment Trust shares, over the last year, without reporting any share sales whatsoever. And so I find myself almost expectant, and certainly hopeful, that this large outlay signals prescient optimism for the business. It is also worth noting that it was Non-Independent Trustee Michael Cooper who made the biggest single purchase, worth CA$4.0m, paying CA$13.45 per share.

It’s me that Dream Industrial Real Estate Investment Trust insiders are buying the stock, but that’s not the only reason to think leader are fair to shareholders. Specifically, the CEO is paid quite reasonably for a company of this size. I discovered that the median total compensation for the CEOs of companies like Dream Industrial Real Estate Investment Trust with market caps between CA$1.3b and CA$4.2b is about CA$2.9m.

The CEO of Dream Industrial Real Estate Investment Trust only received CA$610k in total compensation for the year ending December 2018. That looks like modest pay to me, and may hint at a certain respect for the interests of shareholders. While the level of CEO compensation isn’t a huge factor in my view of the company, modest remuneration is a positive, because it suggests that the board keeps shareholder interests in mind. I’d also argue reasonable pay levels attest to good decision making more generally.

Does Dream Industrial Real Estate Investment Trust Deserve A Spot On Your Watchlist?

One positive for Dream Industrial Real Estate Investment Trust is that it is growing EPS. That’s nice to see. Like chocolate chips in vanilla ice cream, the insider buying, and modest CEO pay, make it better. The sum of all that, for me, points to a quality business, and a genuine prospect for further research. Of course, just because Dream Industrial Real Estate Investment Trust is growing does not mean it is undervalued. If you’re wondering about the valuation, check out this gauge of its price-to-earnings ratio, as compared to its industry.

As a growth investor I do like to see insider buying. But Dream Industrial Real Estate Investment Trust isn’t the only one. You can see a a free list of them here.

Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.

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This full service Vancouver realtor enables clients to make strategic real estate decisions – Vancouver Is Awesome

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A child’s crayon drawing, showing three happy people in front of their new home, graces the office of Andrew Lasko of Lasko and Associates. It was a gift from the eight-year-old daughter of a couple from the Philippines – a thank-you gesture for helping the immigrant family purchase a house in Canada by matching their budget with a motivated private seller. 

While there have been many such satisfactory outcomes throughout his 10-plus years as a realtor, providing “full service and the right kind of experience for every client” takes effort, especially in a fast-paced and constantly evolving real estate market, says Lasko. “I keep this picture around and on tough days, I look at it and remind myself of why I’m doing what I do.” 

The idea of “full service” means different things to different people, and Lasko strives to gauge the exact level for ensuring his clients are comfortable. “That’s why it’s important to start with a conversation to understand their expectations,” he says. “It’s not just about whether they are looking for two or five bedrooms or what kind of amenities they want nearby. I am interested in learning what process works best for them; for example, do they like to be hands-on? Or do they prefer to outsource as many tasks as possible?”

His background in financial planning and analysis in the real estate, urban planning, banking and auditing industries – combined with a passion for community-building – give Lasko an advantage when it comes to enabling clients to make strategic real estate decisions. 

He values “a methodical approach and due diligence” for collaboratively navigating an industry, where structures are useful but market trends sometimes require a quick response. That’s where experience is a big asset, he believes. 

“Over time, you get to know buying patterns; you see where things are offered and where people are looking,” says Lasko. “I can help you explore real estate as a step towards achieving your overall financial and lifestyle goals. I can also speak intelligently about a range of financial products.”

With many of his clients being busy professionals, including accountants, engineers, doctors and lawyers, Lasko aims to minimize the stress that can come with selling or buying a home. “I have pretty big shoulders, so you can trust me to carry much of the load,” he says. “And I’m constantly challenging myself to go the extra mile, to uphold the ethics – and improve the reputation – of the profession.” 

Lasko grew up in Toronto and lived in Sydney, Australia, and Copenhagen, Denmark, before settling in Vancouver in 2007. Moving frequently inspired an appreciation of the “emotional strain that can come with the process, even if you’re super-organized.

“The last time I moved, I had a spreadsheet. I hired a packer and a mover,” he recalls. “I was going to wake up in one place and go to sleep in another.” 

Needless to say, it wasn’t quite as stress-free as anticipated, he admits, and experiences like this have reinforced his commitment to offering his clients “the right experience. 

“I really focus my attention on what they need,” says Lasko, who loves to discover commonalities, for example, in demographic or socio-economic backgrounds. With his ties to the financial, Jewish and LGBTQI+ communities and his active lifestyle, there is always overlap, “like a Venn diagram,” he notes. 

Lasko also hopes to help enhance his clients’ financial flexibility, perhaps by discovering unrealized value. “I love the fact that I can help people enter the market with a condo,” he says, “and move their way up to million-dollar estates.” 

His efforts and results have not gone unnoticed, and Lasko has repeatedly earned professional recognition. Yet what matters most is when clients tell him he’s “the best realtor,” says Lasko. “This gives me the shivers, in a good way.”

Andrew Lasko is featured in the 2022 Excellence in Real Estate Magazine.

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The Pro and Cons of Real Estate Investing: What You Need To Know – ReadWrite

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The outlook for the stock market and much of the economy remains uncertain. That being the case, many investors are looking for alternative spots to grow their portfolios. One of the best choices for a number of reasons is real estate. This exciting field offers benefits both obvious and less well-known that make it an excellent option for your money. But it’s not suitable for everyone. Read on for an explanation of the advantages and disadvantages of real estate investing.

Pros of Investing in Real Estate

Many folks are familiar with some of the advantages of investing in real estate. But unless you’ve taken a closer look, you may miss out on some less well-known but equally valuable benefits.

Multiple Ways to Make Money

Real estate investments offer numerous ways to make money, regardless of your strategy.

For example, owning a rental property doesn’t just make you money from the cash flow you receive each month after the property’s mortgage and bills are paid. It also quietly earns money from appreciation as the property grows in value over time. At the same time, you bank additional money each month when you make the mortgage payment. This allows tenants to pay down the loan’s principal.

Tax Advantages

Not only will you be able to deduct actual expenses required to operate and maintain the property, but you can also take a write-off for depreciation.

This on-paper expense costs you nothing out of pocket but can reduce your tax bill. When you sell the property in the future, you may also be able to take advantage of lower tax rates on capital gains. Alternatively, you might defer taxes entirely by buying a similar property in what’s known as a 1031 exchange.

Protects Against Inflation

Inflation has been a major topic of discussion over the past months as prices continue to grow across the economy. These conditions are ideal for holding a tangible asset like an investment property.

As prices go up, the value of your property tends to increase as well, helping you avoid much of the pain of inflation. At the same time, you’ll be paying back your loan in “cheaper” dollars, generally at a long-term fixed rate. As rents and other income grow over time, your mortgage payments will typically remain the same, improving your returns.

Diversifies Your Portfolio

All too often, people have their whole nest egg invested in the stock market, bonds, or similar financial instruments. This means that they’ve tied their long-term wealth entirely to these financial markets.

Real estate investments offer critical diversification, a key to any balanced portfolio. Few people can truly avoid economic downturns, but having diversified investments means you can lessen the blow and come out the other side as strong as ever.

You Don’t Need a Lot of Money to Get Started

Many people may ignore real estate, thinking they don’t have the cash to find a deal.

This isn’t necessarily the case. Aside from common strategies like rental property investing or house flipping, real estate investors can also get started in low- or no-money-down systems like wholesale real estate.

Those who sell wholesale real estate do the legwork of finding great deals. They usually do this by aggressive and creative marketing to owners who may not even initially consider selling their home. Once they’ve found a willing seller, they connect them with a previously identified buyer who has the cash for an investment property but not the time to search for great deals.

For their work, the wholesaler typically receives a fee. They profit by selling the contract on the property to the end investor at a slightly higher price.

As you can see, this requires little initial investment from those interested in wholesale real estate, other than marketing costs and time spent networking with potential buyers and sellers. It can be an ideal way for would-be real estate investors to generate some capital. They can do so while growing their connections in the local market.

Real estate investors who are just getting started can also use more passive means like REITs, which are essentially mutual funds that hold real estate investments. These are basically hands-off investments but usually generate the lowest returns with the fewest incidental advantages.

Cons of Investing in Real Estate

Like any investment, real estate isn’t perfect and isn’t right for everyone. Before rushing into the real estate investment world, consider the following to avoid a potentially unpleasant surprise down the road.

Many Strategies Require Lots of Cash

We mentioned wholesale real estate above as an example of a low- or no-money-down strategy. However, wholesale isn’t for everyone and every situation, and many other strategies do require a significant amount of money.

Depending on the property type and location, this could be anywhere from the low five figures to six figures or more. For some, this isn’t an unreasonable amount of money. But for others just getting started, it might prevent them from taking advantage of good deals when they arise.

Investments Usually Aren’t Easily ‘Liquidable’

Most real estate investments are long term. If you put down ten or twenty grand on a mortgage, you’re generally unable to access that money without selling the property, ending the investment.

In some cases, you may be able to take out loans or lines of credit to access the equity in properties without selling. However, these come with various fees and restrictions and take time to process. Therefore, real estate investments aren’t the best choice for those who may need to access their money quickly and easily down the road.

Time (or Extra Money) Required

While many investments may be able to grow on their own with little management or involvement, real estate is not among them. You’ll need to deal with finding tenants, conducting maintenance, and other day-to-day requirements of owning a property. Some may find their enthusiasm for real estate investing flagging after the third call in a week for a clogged toilet or locked-out tenant.

Of course, property management companies exist for precisely this reason, allowing professionals to take care of these things so you don’t have to. But you’ll need to give up some of your returns to pay any property managers, who usually take a cut of the rent they collect for you each month.

A Great Deal Lies Outside Your Control

You may do everything right when it comes to finding the right property, picking the right tenant, and managing correctly. Still, real estate investors face lots of factors outside their control.

The city your property is located in may change rental rules or zoning. Similarly, a huge new housing development could open up nearby. Your property’s ideal neighbors may sell their home. They might be replaced by party animals who leave their lawn covered in trash. These are just a few downsides you’re exposed to that you’ll often have little notice of or way to avoid.

Real Estate Investing: A Top Way to Grow Your Money…But Not For Everyone

Those looking to grow their portfolio will find few better ways than real estate investing. From long-term buy-and-holds to wholesale real estate, there are so many strategies for investors to tailor to their financial needs and resources.

Still, it’s crucial to remember that real estate may not be right for all investors. You should assess your situation and any potential deals carefully before jumping in. Who knows? You may be on the verge of an investment that changes your financial situation forever!

Image Credit: RODNAE Productions; Pexels; Thanks!

Deanna Ritchie

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

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Canadian Real Estate Affordability Hits Worst Level Since The 90s: Bank of Canada – Better Dwelling

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Canadian Real Estate Affordability Hits Worst Level Since The 90s: Bank of Canada  Better Dwelling



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