High-Yield REITs to Avoid: CBL & Associates (CBL)
CBL & Associates Properties, Inc. (NYSE:CBL) manages town centers with a focus on retail space. And given its recent second-quarter earnings, out Aug. 3, there is great consternation the past may well be prologue.
Net revenue was off 40% compared to the same quarter a year ago. And funds from operations (FFO), the true measure of a REIT’s profitability, was off 20%.
Obviously, the retail space has been tough. But CBL is now shuttering new projects and is showing slower traffic and revenue in its operations. This means growth is under pressure. And when stocks in a growth sector aren’t growing, the Street doesn’t treat them well.
Yes, CBL has a whopping 12% dividend yield. But the stock is off 26% year to date. There’s little reason to bet on this trend changing before the end of the year.