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REITFocused is Neutral about WPG

Summary: Neutral Hold Overvalued Owns this stock
I'm neutral on Washington Prime Group. I own some share for the long term, but only a small position, which doesn't put my portfolio at risk. It's great to receive a 12% dividend yield, but I try not to be too attached to it. I’m still bearish about WPG's performance during the next few years and their ability to continue to maintain the current dividend value, but bullish on the long-term. I would like to believe their redevelopment initiatives will yield returns within a few years, but I think they have many challenges which will put pressure on their cash flow. WPG's 2018 second quarter dividend payout rates are within conservative payout levels. However, in my opinion, their dividends are not guaranteed in the following years as they need to continue to invest in redevelopment, in replacing risky anchor tenants, renewing leases, and disposing of low-performing assets. If they do need to cut their dividends on the path to reinventing themselves, I imagine their low share price will drop even further. This will present an opportunity to invest in WPG at even better Price-to-AFFO multiples. So I will remain on the sidelines for now and see which direction their payout-ratios and dividends head. - REITFocused - 2018-09-20 22:22:40 PDT

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