Isn't it interesting to see how sentiment has started to change on the REIT sector - as evidenced by the two mainstream newspaper artciles re-posted on this thread.
As an aside, funny how back in Jan-08 MFS said they wanted to do a Rights issue to reduce debt and themarket destroyed the stock...never to retunr and now - 12/15 months later ANY NUMBER OF ASX STOCKS have been applauded for doing Rights issues/Insto placements/SPP in order to reduce debt and re-cap their businesses. And even funnier that those companies who have held out from doing placements - like GMG (excluding the smaller dilutionary impact of the CIC/MQG oppies issue) were getting "panned"by the experts!
Well, times do change quickly don't they? And here we see yet another sentiment shift in the markets with a couple of people (evidenced in these 2 articles) now willing to publicly argue that REITS are oversold and may have raised TOO MUCH cash!
What do I learn from this? Well - it reinforces a few principle rules we already know: hindsight is a wonderful thing, and market sentiment/views/opinions/biases CAN CHANGE VERY QUICKLY....so, "know yourself"and "know why you invest"so you don't get confused.
"Those who go with the crowd, soon become lost in it"
Well...if sentiment towards debt/property/REITS/equity placements can shift like the sands over such small time horizons (12-15 mnths aint that long in the scheme of life)...that sure as heck, tells you DON'T BE QUICK TO PANIC next time.
Conclusion: While we will only know the outcome in the fullness of time, it MAY BE that Greg Goodman pulled the right reign in staring down the Instos, and establishing strategic partnerships with 2 entities, rather than a MASSIVE DILUTIONARY placement. Who knows - 6 months from now - we could be reading articles in Shares Magazine/Personal Investor Mag about how 1st Half 2009 was the opportunity of a lifetime to get back into Property Trusts, and how the brave are now reaping the benefits?!
I have certainly learnt a lot - not the least that investing in cash flow positive, profitable businesses with REAL ASSETS trading at 80% discounts to NTA offer significant Risk/Reward opportunities to astute investors.
Regards
Coop
GMG Price at posting:
38.6¢ Sentiment: LT Buy Disclosure: Held
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