> Yield: 7.9%
Kimco Realty Corp. (NYSE: KIM) is a shopping center REIT that was supposed to have about a 1% exposure to Toys “R” Us, and that has allowed its shares to slide from about $18 since the start of 2018. Kimco has a yield of 7.9%, and its current share price of $14.12 is less than the consensus target price of $18.05. Its $1.12 annualized dividend is expected to rise to $1.18 in 2020.
Kimco may have Toys “R” Us exposure, but it is making the pop-up shops easier to accommodate, and the company has outlined that its Toys “R” US exposure is just 1% and that those leases at risk are at sub-market rates that could bring upside.
> Yield: 6%
L Brands Inc. (NYSE: LB) has been a poor performer in retail, with Victoria’s Secret, Bath & Body Works and others with 3,000 or so stores in North America. Its products are under names like Victoria’s Secret, PINK, Bath & Body Works, La Senza, Henri Bendel, C.O. Bigelow, White Barn and others. The slide of mall-based and shopping-center-based retail has taken a toll, with a current share price of $39.75 down from about $60 at the start of 2018. If analysts are right with the $48.60 consensus target, it may be too much of a drop. The $2.40 annualized payout generates a high 6% yields, and Thomson Reuters sees that dividend at $2.51 per share in 2020.
Despite the bashing and dismal stock performance, L Brands did beat earnings estimates, it did show some same-store sales growth and it has a share buyback. Investors just need to be reminded that it is sometimes painful trying to catch falling knives.
> Yield: 6.0%
PPL Corp. (NYSE: PPL) shares have fallen about 10% since the start of 2018, and it has regulated utility operations in Pennsylvania, Kentucky, the United Kingdom and other areas. At $27.45 a share, it has a yield of 6%, based on the annualized $1.64 dividend. That is well under its expected earnings per share, and the dividend is expected to rise to $1.75 per share in 2020. PPL has a consensus target price of $32.65 and a $19 billion market cap.
PPL was a $40 stock last summer, and its attempts to recover in 2018 have disappointed, with shares down about 15% from the 2018 highs. That said, RBC did raise its rating to Outperform from Sector Perform in early March, and the firm assigned a $33 price target.
> Yield: 6.5%
Welltower Inc. (NYSE: WELL) is also a REIT, but it invests in senior housing operators, post-acute providers and health systems. With a $19.6 billion market cap and a $52.85 share price, Welltower has a 6.5% yield, and analysts expect the annualized dividend of $3.48 to grow to $3.74 in 2020. This was a $60 stock as recently as January.
Welltower used to be Health Care REIT, with the former HCN ticker, and investors frequently hate name and ticker changes. It also has operations in Canada and the United Kingdom. JPMorgan maintained a Neutral rating on Welltower in mid-March, but cutting the target to $67 from $71 still implies a lot of upside if this has become oversold.