Alto Palermo (APSA)
Market Cap: $497 million
Dividend Yield: 10%
YTD Price Performance: -22%
Alto Palermo (APSA) is a REIT that owns and operates shopping centers as well as residential and commercial complexes. As a REIT, it is required to pay out most of its earnings in dividends, and there’s nothing inherently fishy about a REIT with a yield of 10%.
The only thing really wrong with Alto Palmero is beyond its control: It’s located in Argentina. With an unofficial inflation rate running as high as 25% (no one believes the official figures), capital flight and currency controls, rapidly rising wages, and an interventionist government, Argentina isn’t particularly attractive to investors these days.
Regardless of the fundamentals, the sentiment on Argentina is too negative to take a risk with APSA stock.