Real estate stocks could outperform in a stagflationary environment.
Continuing inflation and the possibility of rising interest rates have caused investors to worry about the stagflation of the 1970s era back in 2022. Last time stagflation became a problem, real estate became the most efficient sector in the market. Buying real estate can be difficult and expensive, but investors can easily invest in real estate by buying shares in real estate investments, or REITs. There are many types of REIT, and many of them pay great dividends and serve as a reliable source of income. Here are eight of the best real estate stocks you can buy in 2022, according to CFRA analysts.
8 top real estate stocks to buy:
Prologis Inc. (ticket: PLD)
Prologis is an industrial REIT that focuses on logistics real estate. Analyst Michael Elliott says there is a great need for Prologis logistics, and there is a huge entry barrier that limits competition in space. Elliott estimates that Prologis' local portfolio could support $ 26 billion at the start of a new development, and says the area is a unique asset in a market where the main land is scarce. Despite supply chain problems, Elliott says, hiring rates are strong and Prologis should keep the price strong as the country's e-commerce growth drives the warehouse demand. CFRA has a "buy" rate and a $ 170 price target for PLD stock, which closed at $ 168.65 on April 8th.
Equinix Inc. (EQIX)
Equinix is a special REIT operator of the world's largest data center operator. Analyst Keith Snyder says Equinix has limited competition and opportunities to expand the area. It also has a high revenue visibility due to its repetitive revenue model. Equinix has partnered with some of the world's largest technology companies. Snyder says Equinix's acquisition of $ 335 million from the stainless steel company Packet will help Equinix speed up the shipment of its connected edge services, including its Equinix Metal service. He expects 8.8% of Equinix revenue growth by 2022. CFRA has a "buy" rating and a target price of $ 900 for EQIX stock, which closed at $ 768.78 on April 8th.
Realty Income Corp. (O)
Realty Income is a REIT retailer that owns, develops and owns U.S. real estate. by focusing on buildings that rent one. Elliott says Realty is more protected from the decline of the retail industry than most of its peers in recent years due to the irrational businesses of many of its employers. In addition, he says the stock is a bet on protective properties in view of the potential for a decline in consumer spending. paid 4.1% dividends. CFRA has a "buy" rating and a $ 75 O-price target, which closed at $ 72.16 on April 8th.
Equity Residential (EQR)
Equity Residential is a REIT residential owned and operated residential facility throughout the U.S. Analyst Kenneth Leon says rising rental rates, especially in coastal cities, could be a tough wind for Equity in future areas. In California and other urban markets, affordable barriers prevent many potential buyers from buying one-family homes, making apartments a more cost-effective solution. Over time, Leon says a large number of Generation Z budding people will drive the need for Equity Residential multi-family business as the generation thrives on employees. CFRA has a "buy" rating and a $ 103 EQR stock price target, which closed at $ 91.77 on April 8th.
Alexandria Real Estate Equities Inc. (ARE)
Alexandria Real Estate Equities is a REIT office that specializes in the commercial field of the health sciences industry. Alexandria shares gained strength in January after the second stock offer and are down 8.5% year-on-year to date. Leon says the weakness of 2022 is a compelling buying opportunity for long-term investors as Alexandria has a high-quality asset portfolio. In addition, REIT has a 4.8 million-square-foot [4.8 million sq m] building under construction. CFRA has a "buy" rate and a target price of $ 240 for ARE stock, which closed at $ 202.89 on April 8th.
Extra Space Storage Inc. (EXR)
Extra Space Storage is a special REIT owned and operated storage facility throughout the U.S. Elliott says the increase in employment and population growth is higher than expected in 2021, and expects the same in 2022. In the near future, Elliott says, providing chain disruption and staff shortages will hamper the construction of the warehouse and limit the structure of the warehouse, which will maintain a high standard of living and employment. Over time, he says, Extra Space will benefit from global e-commerce growth, which requires end-to-end delivery services. CFRA has a "buy" rating and a $ 204 price exit on the EXR stock, which closed at $ 213.71 on April 8th.
Weyerhaeuser Co. (WY)
Weyerhaeuser is a special REIT that grows timber and produces and sells forest products and pulp. Elliott says the thriving housing market is a breeze in Weyerhaeuser, and the construction of large houses and the backlog of renovations will keep the demand for timber rising. In addition, Elliott argues that logs have historically been an excellent barrier to inflation for investors, providing another source of possible rise in Weyerhaeuser shares. Weyerhaeuser achieved a record revenue growth rate of 35% in the 2021 financial year, but Elliott expects a decrease of 6% to 7% by 2022. CFRA has a “buy” rating and a $ 42 WY stock price target, which closed at $ 38.68 on April 8th.
Mid-America Apartment Communities Inc. (MAA)
Mid-America Apartment Communities is a REIT residential and operating multi-family facility in the cities and towns of the Sun Belt. Leon says Mid-America should move beyond the peer group to the growth of rental properties, and commodity prices in the region are recovering faster in this epidemic than in other regions. U.S. housing shortages and recorded retail prices drive the need for rental flats, and Leon says the imbalance in supply chain needs may continue to increase Mid-America’s cash flow by 2022. CFRA has a "buy" rating and $240 price target for MAA stock, which closed at $214.33 on April 8.
