Kimco (KIM) CEO Henry Seeks To Profit from Sears (SHLD) Troubles
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Kimco Realty (NYSE: KIM) may have become the best pure-play stock on retail real estate...and that has piqued the interest of one Jim Cramer.
Recently, Cramer spoke with Kimco CEO David Henry. Kimco currently has operates roughly 800 centers across the country with a 93.5 percent occupancy rate. After the market closed Wednesday, Kimco reported fourth-quarter FFO of 33 cents, beating views by 3 cents. The REIT also issued some strong fiscal 2012 guidance calling for FFO of $1.22 to $1.26, beating views of $1.19.
Henry said Kimco has just 4.5 percent of its total portfolio as non-retail properties. Further, Henry said Kimco's focus and holdings centered around staples like groceries, drugs, services, and discounted items, making them less vulnerable to erratic market shifts compared to Internet competition.
Bankruptcies, like that of Borders Group, give Kimco a fresh set of opportunity as well, with older tenants having lower rents in most cases. On Sears Holdings (Nasdaq: SHLD) and Kmart, Henry said that if those locations close then Kimco could benefit because Sears and Kmart also pay rent below market value. He said the REIT would have no problem filling those locations.
Finally, the CEO is bullish on both Canada and Mexico. For Canada, Henry says there's about half as many retailers as in the U.S. and the economy is a strong one, providing a great opportunity for Kimco.
Overall, previously a bear on the stock Cramer now sees Kimco as a solid play on retail growth. What's more, Kimco pays out 19 cents in a quarterly dividend, with a current annual yield of about 4 percent.
Shares are 1.2 percent lower Friday.
Recently, Cramer spoke with Kimco CEO David Henry. Kimco currently has operates roughly 800 centers across the country with a 93.5 percent occupancy rate. After the market closed Wednesday, Kimco reported fourth-quarter FFO of 33 cents, beating views by 3 cents. The REIT also issued some strong fiscal 2012 guidance calling for FFO of $1.22 to $1.26, beating views of $1.19.
Henry said Kimco has just 4.5 percent of its total portfolio as non-retail properties. Further, Henry said Kimco's focus and holdings centered around staples like groceries, drugs, services, and discounted items, making them less vulnerable to erratic market shifts compared to Internet competition.
Bankruptcies, like that of Borders Group, give Kimco a fresh set of opportunity as well, with older tenants having lower rents in most cases. On Sears Holdings (Nasdaq: SHLD) and Kmart, Henry said that if those locations close then Kimco could benefit because Sears and Kmart also pay rent below market value. He said the REIT would have no problem filling those locations.
Finally, the CEO is bullish on both Canada and Mexico. For Canada, Henry says there's about half as many retailers as in the U.S. and the economy is a strong one, providing a great opportunity for Kimco.
Overall, previously a bear on the stock Cramer now sees Kimco as a solid play on retail growth. What's more, Kimco pays out 19 cents in a quarterly dividend, with a current annual yield of about 4 percent.
Shares are 1.2 percent lower Friday.
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