3 Beaten-Down REITs to Take Advantage of Right Now

The Real Estate Investment Trust (REIT) industry is relatively better positioned than many industries to survive the high market volatility, as they typically benefit from an inflationary environment. Moreover, investors prefer REITs in troubled times because of their high dividend distributions.

The FTSE EPRA/Nareit Global Real Estate Index Series outperformed broader markets in July 2022. Moreover, according to Statista, the REIT industry in the U.S. achieved a record market capitalization of $1.74 billion in 2021. Rising demand for space and warehouses fosters significant growth possibilities for REITs.

Given the industry’s promising prospects, it could be wise to invest in beaten-down yet fundamentally strong REITs Apartment Income REIT Corp. (AIRC), Bridge Investment Group Holdings Inc. (BRDG), and Urstadt Biddle Properties Inc. (UBA).

Apartment Income REIT Corp. (AIRC)

AIRC is a real estate investment trust focused on the ownership and management of quality apartment communities located in the largest markets in the U.S. It is one of the country's largest owners and operators of apartments, with 99 communities in 12 states and the District of Columbia.

On July 28, 2022, CEO Terry Considine said, "With a clear strategy focused on efficient operations, low leverage, a capable team, and an engaged Board, AIRC has achieved substantially all of the goals set out."

AIRC's rental and other property revenues increased 2.4% year-over-year to $181.01 million for the second quarter ended June 30, 2022. Its total revenues came in at $183.50 million, up 2.9% year-over-year. Also, its NAREIT FFO came in at $100.42 million, up 131.1% year-over-year, while the NAREIT FFO per share came in at $0.64, up 128.6% year-over-year.

AIRC's revenue is expected to increase marginally year-over-year to $753.68 million in 2022. Its EPS is estimated to grow 6,650% year-over-year to $4.05 in 2022. Over the past month, the stock has lost 9.4% to close the last trading session at $41.08.

AIRC's strong fundamentals are reflected in its POWR Ratings. The stock has an overall B rating, which indicates a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.

AIRC has a B grade for Growth, Sentiment, and Quality. Within the REITs – Residential industry, it is ranked #2 out of 23 stocks. Click here for the additional POWR Ratings for Value, Momentum, and Stability for AIRC.

Bridge Investment Group Holdings Inc. (BRDG)

BRDG engages in the real estate investment management business in the United States. It manages capital on behalf of approximately a hundred global institutions and 6,500 individual investors across 25 investment vehicles.

On August 8, 2022, BRDG launched its newest strategy, Bridge Ventures. This venture will focus on early and later-stage PropTech companies and pursue investments in industry-leading PropTech funds, thereby diversifying BRDG's existing portfolio.

In addition, on July 13, 2022, BRDG launched its Bridge Solar Energy Development in partnership with Lumen Energy Inc. This collaboration aims to build advanced solar projects toward achieving the goal of profitable de-carbonization.

BRDG's total revenues came in at $99.02 million for the second quarter that ended June 30, 2022, up 37.6% year-over-year. Its revenues from fund management fees came in at $49.38 million, up 43% year-over-year. Moreover, its net income came in at $124.38 million, up 49.4% year-over-year.

Analysts expect BRDG's revenue to rise 15.3% year-over-year to $380.52 million in 2022. Its EPS is expected to grow 18.3% year-over-year to $1.10 in 2022. Also, it surpassed EPS estimates in each of the four trailing quarters. The stock has lost 4.8% over the past month to close the last trading session at $16.22.

It's no surprise that BRDG has an overall B rating, representing a Buy. It has a B grade for Growth, Momentum, Sentiment, and Quality. It is ranked #2 out of 49 stocks in the REITs – Diversified industry. Click here to see the additional ratings for BRDG (Value and Stability).

Urstadt Biddle Properties Inc. (UBA)

UBA is a self-administered equity real estate investment trust which owns or has equity interests in 81 properties containing approximately 5.20 million square feet of space. It provides investors with a means of participating in the ownership of income-producing properties.

On June 8, 2022, Willing L. Biddle, UBA's President and CEO, said, "Our leasing and management teams are very busy working to deliver space for our new tenants and have a strong pipeline of new leasing deals in process."

He added, "We currently have 68,700 square feet of new leases in the negotiation stage as well as letters of intent for over 159,000 square feet."

For the second quarter that ended April 30, 2022, UBA's total revenues came in at $36 million, up 9.3% year-over-year. Its net income came in at $7.11 million, up 53.8% year-over-year, while its EPS came in at $0.18, up 50% year-over-year. Furthermore, its FFO came in at $14.27 million, up 21.7% year-over-year.

UBA's revenue is expected to increase 4.6% year-over-year to $141.86 million in 2022. Its EPS is expected to grow 5.9% per annum for the next five years. The stock has lost 7.4% over the past month to close the last trading session at $17.04.

UBA's overall B rating equates to a Buy in our proprietary rating system. In addition, it has a B grade for Growth, Stability, and Sentiment.

UBA is ranked first among 32 stocks in the REITs – Retail industry. Click here to see the additional POWR Ratings for UBA (Value, Momentum, and Quality).

AIRC shares were trading at $41.26 per share on Wednesday morning, up $0.18 (+0.44%). Year-to-date, AIRC has declined -22.33%, versus a -15.70% rise in the benchmark S&P 500 index during the same period.

Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries.

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