NEW YORK (
Real estate investment trust
traded higher Monday while
bid lower following mixed broker action.
Rayonier shares gained 1.2% to trade around $52.31 past midday.
Analysts from Stifel Nicolaus initiated coverage of the forestry products and timberland REIT with a buy rating and $60 price target.
Wells Fargo initiated coverage of Rayonier last week, also giving it a buy rating and $60 price target.
Plum Creek Timber
also received a buy rating from Stifel Nicolaus. The equities research firm set a $43 price target for the REIT.
CNBC's Brian Kelly, in an episode of
's "Fast Money" TV show, said that with cotton and lumber prices surging he would play the sector with Plum Creek and Rayonier as well as
Plum Creek is among fund managers' favorite REIT stocks. Along with newly converted
and Rayonier, Plum Creek represents a simple and effective way to add timber, which has historically been an outstanding currency and inflation hedge, to a portfolio. Plum Creek sells its timber for use in a wide range of products including plywood and fiberboard for use in housing construction.
Because the housing market remains challenging, Plum Creek CEO Rick Holley says the company is "holding our most valuable lands for future opportunities while capturing good value in lower-value markets where prices remain the most attractive." While the company may be holding back its best land as it waits for a better price, it's currently paying out a healthy 4.6% dividend yield.
"It's also worth noting that timber offers the added bonus of being a key export commodity to emerging economies, which is very important nowadays," said Peter Sorrentino, manager of the
Huntington Real Strategies Fund
Weyerhaeuser, the homebuilder-turned-
real estate investment trust, meanwhile announced early Monday it intends to reward shareholders with an increased dividend.
Weyerhaeuser will pay a quarterly dividend of 15 cents per share, with the first dividend payment expected to occur in March 2011, for a yield of about 3.4%. The board will determine and declare the actual dividend on a quarterly basis.
Shares of CommonWealth REIT were downgraded by Stifel Nicolaus from buy to hold.
CommonWealth, formerly HRPT Properties Trust, is a REIT engaged in the ownership and operation of office and industrial buildings and leased industrial land. Its subsidiaries include
Hospitality Properties Trust
Senior Housing Properties Trust
Government Properties Income Trust
Over the summer analysts from RBC Capital Markets reiterated a sector perform rating on CommonWealth shares, lowering their price target on the REIT by $5 to $28, according to
CommonWealth shares were 0.6% lower in early-afternoon trading Monday.
-- Written by Miriam Marcus Reimer in New York.
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