Plum Creek Timber
When it comes to traditional real estate investment trusts, Plum Creek Timber (PCL) is one of the most unique names out there. The nearly $6 billion firm is part REIT and part traditional corporation, manufacturing wood products in addition to its timber property holdings.
That positioning means that Plum Creek is heavily tied to commodity costs. Shifts in timber prices directly impact this firm's profitability, even if the recent rally in timber hasn't been reflected in its share price yet.>>TheStreet Ratings' Top-Rated REITs Plum Creek owns 6.8 million acres of timberland in 19 states. While the firm's timber harvesting business is less profitable per acre than the industry norm, this REIT has historically shown a willingness to unload portions of its portfolio for developers and conservationists who were looking to buy part of PCL's land portfolio. That focus on shareholder returns is welcome -- particularly as piecemeal sales of land are so much more lucrative. At present, Plum Creek's short interest ratio comes in at 10.2, indicating that short sellers are still taking a sizable position in betting against this firm. While other timber REITs look more attractive than Plum Creek, that heavy shorting could mean a near-term pop in share price. A 4.65% dividend yield and ample balance sheet liquidity should keep longs interested in this stock too.
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