), an apartment-only real estate investment trust (REIT), has
recently increased its quarterly dividend payout by 5.3% to 69.5
cents per share or $2.78 on an annualized basis. The dividend is
payable on January 31, 2013 to shareholders of record on January
MID-AMER APT CM (MAA): Free Stock Analysis
UDR INC (UDR): Free Stock Analysis Report
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The proposed dividend affirms a yield of 4.4% based on the
closing price of $62.75 as on December 5, 2012. MAA is among a
select group of companies who have maintained an uninterrupted
dividend payout even during recession, when most companies had
suspended the same. The company has historically paid cash
dividends for 76 consecutive quarters and the present dividend
hike signifies its continued strong operating performance,
despite a challenging macroeconomic environment.
Investors looking for high dividend yields are increasingly
favoring REITs like MAA. Solid dividend payouts are arguably the
biggest enticement for REIT investors as the U.S. law requires
REITs to distribute 90% of their annual taxable income in the
form of dividends to shareholders.
Since its inception in 1994, MAA has evolved as a publicly-owned
company from a portfolio of 6,000 apartments in the Mid-South
area to a portfolio of 49,795 high-quality apartment homes spread
across the Sunbelt region of the U.S.
The company typically divides its portfolio in two tiers - larger
primary markets and lower population secondary markets. Secondary
markets often have stable fundamentals due to limited new supply.
Having a diversified presence in different types of markets helps
mitigate risk and decreases volatility in the event of a slowdown
in any one product type.
MAA's diversified market profile with its focus on solid
employment markets of the Sunbelt region across both the
high-growth primary markets and the less cyclical secondary
markets provides a stable earnings platform for the company.
With new supply remaining muted until late 2013 or 2014, we
expect the multifamily sector to remain comparatively stable in
the coming quarters, as renting has emerged as the only viable
option for customers who could not get mortgage loans or are
unwilling to buy a house at present.
We maintain our Neutral recommendation on MAA, which presently
has a Zacks #3 Rank that translates into a short-term Hold
rating. We also have a Neutral rating and a Zacks #3 Rank for
), one of the competitors of MAA.