Timber REITs Offer Growth And Income
The Dynamic Wealth Report
September 15, 2008
These Stocks Are Growing To The Sky!
Have you ever been to Flagstaff, Arizona? If not, I recommend you visit
some time. Flagstaff's a quaint little town located in the northern
mountains of Arizona. The pine trees grow like crazy and in the summers
a cool breeze always blows.
It’s a nice escape from the Arizona desert . .
. especially in the summer when it’s over 110 degrees. Spend a short
summer in Arizona and you’ll know exactly what I mean.
Every summer as a kid we’d head up to the woods.
My parents would drag me and my brothers, our thee dogs, and a week’s
worth of supplies up to the cabin. My grandparents still have the place
just outside Flagstaff. I’ve got great memories of summers spent
exploring the woods, swimming and fishing in the lake, and just enjoying
nature.
I loved it so much I’m starting to look at buying a place of my own . .
.
Of course I sometimes jump in a little deep. Don’t laugh. But I found a
really interesting piece of property just the other day.
-------------Sponsor-------------
Where Can You Turn $300 Into $1.3 Million Right Now?
Our own small-company specialist, Robert Morris, has found a
way to 'sniff out' tiny penny stocks on the verge of a major breakout. And
the timing for this has never been better.
You see, the system takes advantage of an obscure SEC regulation that
sends penny stock prices through the roof.
We've seen some stocks gain 852%... 5,450%... even 17,496% in no time
flat.
Click here
for the details...
-----------------------------------
A broker was advertising 13,000 acres of forest for sale in
Pennsylvania (see I told you I think big). The pictures of the property
are beautiful. Rolling hills and wide swaths of timber. The property even
came with all the natural gas, mineral, and oil rights still intact.
The only problem was the asking price . . . a mere $32 million.
If you’re quick on the math you know the property’s selling for just
over $2,400 per acre. Is that a good deal? I don’t know but I was
determined to find out.
The broker noted the property was generating $150,000 a year in income
from campground rental fees. It sounds good till you realize that’s a
return of less than 1%. (Actually, it’s less than half of 1% per year).
Not very exciting.
However, timber can be a great investment – and very exciting (if you
know how to do it). It’s like being a farmer, with a really big crop. Every year the trees grow larger and larger. Every season their value
increases. Someone with good land and forestry management skills could
probably create some substantial income.
The thought of buying this property is really appealing.
But I don’t know the first thing about timber management. . . Oh, and
I’m just a little short of the $32 million purchase price. I do however
know of a cheaper and easier way to invest in timber.
What am I talking about?
Timber REITs of course. These companies are set up to buy and manage
large amounts of timber. You can buy these REITs for a few dollars each
on the stock market. No complex contracts or negotiations. Just use you
normal brokerage account.
These Tree REITs give you ownership in some of the best timber property
in the world. They come with top notch management . . . who know what
they’re doing. And best of all, they pay a great dividend (some more
than 4%).
So here are the ones I like.
The first REIT is Rayonier (RYN). They own more than 2.6 million acres.
Rayonier also has two other businesses, one in traditional real estate
development and the other in fiber production (so it is not a pure play
Tree-REIT). Their market cap is just over $6.3 billion. With a little
quick math, you can buy the company for roughly $1,392 per acre.
The second company is Plum Creek (PCL). They own 8 million acres of
timber. Their market cap is a whopping $8.5 billion. But their land
holdings are big. This company’s trading at roughly $1,062 per acre. Not
bad at all.
The last company I found was Potlatch (PCH). They only own 1.7 million
acres of timber. Their market cap is $1.9 billion. That means every acre
of property they own is worth $1,117.
I guess my dram of buying 13,000 acres of forest in Pennsylvania for
$2,400 an acre isn’t such a good deal after all. These three investments
however are cheaper (per acre), and they even pay nice dividends. If the
idea of owning a forest sounds appealing take a closer look at these
REITs.
• Water (Up more than 17%)
Over the last month there's one industry outshining all others . . .
water. The industry was lead higher by Aqua America (WTR),
American
Water Works (AWK), and Consolidated Water (CWCO). Recent rate increases
and indications of increasing demand have helped move stock prices
higher.
Print
Page
Bookmark Us
Home | Whitelist Us |
Terms of Use |
Privacy Policy |
Contact Us | Security |
Site Map