Australia Regulator Probes $20 Billion Private Credit Manager
The probe is part of a two-year review of private markets that the Australian Securities & Investments Commission is conducting across the industry. The regulator is giving more attention to Metrics and some of its transactions because of specific concerns about the firm's practices and in light of its substantial exposure to real estate, according to the people.
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2 minutes ago
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Exciting Time, Data Center Construction Booming: Aon CFO
Edmund Reese, AON Executive Vice President and CFO, says Aon is bringing new capital into the market, not just in traditional areas, but also in other insurance-linked securities, emphasizing that the company is a leader in that space. He speaks to Romaine Bostick and Scarlet Fu on "The Close." (Source: Bloomberg)
Yahoo
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- Yahoo
Biotech Is Booming, and This Undervalued REIT Stands to Gain
While most commercial office landlords are still hunting for post‑pandemic tenants, there's a sector of the real estate industry that's breeding breakout growth: life sciences. Global biotech spending is projected to triple from roughly $1.7 trillion in 2025 to more than $5 trillion by 2034. All that R&D cash needs purpose‑built laboratory space. That's what makes Alexandria Real Estate Equities (NYSE: ARE) such a standout real estate investment trust (REIT). It owns the largest portfolio of labs and life-science properties in the United States and has a client base of approximately 750 high-quality tenants, including Eli Lilly, Moderna, and Bristol-Myers Squibb. With this strong tenant base, Alexandria is poised to generate returns that could replicate like stem cells. Tenants engineered for long-term occupancy With occupancy rates of 92% and the majority of their space leased to biotech, pharmaceutical, and agricultural technology (AgTech), Alexandria is in a league of its own in comparison to other REITs. Given the highly specialized nature of their business, laboratory tenants require customized spaces, so they sign longer leases and rarely move. Thanks to this, last quarter, ARE locked in rent increases of 18.5% on average when tenants renewed and 7.5% when new ones signed, a strong sign of pricing power even during a period of lower leasing demand. The company also has a weighted-average remaining lease term of 7.6 years, indicating strong tenant commitment and predictable long-term cash flow, boosting the company's overall income stability. With a lease portfolio this stable, you could call it genetically engineered for sizable returns. Rebuilding the balance sheet with surgical precision Instead of chasing growth for growth's sake, management has been smartly recycling capital. During 2024, it focused on selling noncore assets to free up cash, reduce debt exposure, and reinvest funds into higher-yielding developments, an approach that improves returns while lowering long-term risk. For 2025, it plans another $2 billion of dispositions and minority‑interest sales, roughly one third of which is already closed or under contract. Proceeds are being funneled into its high‑margin mega‑campus developments that have consistently proven profitable for ARE, further strengthening the company's financial position. Only 13 % of outstanding debt matures before 2028, and the average term is now over 12 years, which is longer than any other REIT in the S&P 500 (SNPINDEX: ^GSPC). Incubating tomorrow's rent roll Even with occupancy not at full capacity, Alexandria has roughly 4 million square feet of Class A lab projects under construction in Boston, San Diego, and the Bay Area. Much of that space is pre‑leased, and the rest should command premium rents once biotech funding rebounds. Combined with contractually built-in rent escalators that will boost revenue annually even without new leases, that pipeline points to rising cash flow in the near future. After paying dividends, the company still expects to retain roughly $475 million of operating cash this year, enough to self‑fund a good chunk of its expansion. Potential side effects to monitor Investors should keep in mind that, while the long-term outlook for the life sciences industry is favorable, demand can be cyclical. If the biotech funding window slams shut due to larger macroeconomic trends, leasing of ARE's new projects could slow. Rising interest rates are another wild card. Alexandria's current interest‑rate swaps shield it for now, but costs will climb when that protection rolls off. Additionally, biotech companies operate on long R&D cycles. If a wave of Alexandria's tenants hit clinical trial setbacks or fail to bring products to market, they may downsize or go out of business, reducing demand for space. Management already trimmed its 2025 adjusted funds from operations (AFFO) guidance after a small dip in occupancy and higher interest expense. As AFFO is a key metric used to assess a REIT's true operating performance and its ability to support dividends, any downward revision can signal slower growth or pressure on dividend safety if trends persist. The company also missed its Q1 2025 earnings per share (EPS) forecast, reporting a $0.07 loss per share versus the $0.76 expected. While EPS isn't as relevant as FFO for REITs, the miss still raised questions about timing of asset sales, operating expenses, and lease activity. Investors should watch closely to make sure management follows through on its efficiency and disposition goals in upcoming quarters. A prescription for income and upside Alexandria currently trades around $71 a share and yields a 7.27% dividend, far above the 4% average REIT payout. More importantly, last quarter's dividend used just 57% of FFO. That's considered a conservative payout ratio for a REIT, suggesting that the company isn't stretching itself to pay investors. ARE also appears to be extremely undervalued right now. It trades approximately 7x forward FFO, lower than many other high-quality REITs, especially those with stable tenants and strong growth prospects. Shares still trade more than 65% below their 2021 peak, meaning ARE offers both attractive yield today and potential upside tomorrow. For income seekers willing to stomach a bit of volatility, Alexandria Real Estate Equities looks like a REIT worth implanting into a diversified portfolio. Should you buy stock in Alexandria Real Estate Equities right now? Before you buy stock in Alexandria Real Estate Equities, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Alexandria Real Estate Equities wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $636,774!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,064,942!* Now, it's worth noting Stock Advisor's total average return is 1,040% — a market-crushing outperformance compared to 182% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 The Motley Fool has positions in and recommends Alexandria Real Estate Equities and Bristol Myers Squibb. The Motley Fool recommends Moderna. The Motley Fool has a disclosure policy. Biotech Is Booming, and This Undervalued REIT Stands to Gain was originally published by The Motley Fool
Yahoo
29 minutes ago
- Yahoo
Hurricane season is heating up and these Canadian oil stocks are poised to benefit
It was a busy week as major members of corporate Canada released earnings that left analysts rethinking their price targets. Meanwhile, meme stocks burst back onto the scene, but what's driving the phenomenon is different this time around. Stock of the week: Tesla Inc. Shares of Tesla Inc. (TSLA) hit the skids this week when the electric vehicle maker reported sales that fell the most in a decade. But after dropping eight per cent following the release of earnings on Wednesday, the stock recouped some of those losses to close Friday at US$316.06. Elon Musk and his company have been on a roller-coaster in recent months, with his support for Donald Trump turning off customers and a public falling out with the president then rattling shareholders. Reflecting some of the chaos, price targets are all over the map for Tesla, ranging from a high of US$500 at Wedbush Securities to a low of US$120 at JPMorgan Chase and Co., according to Bloomberg data. The average target is US$302.04. Tesla shares are down 22 per cent year to date but up 42 per cent their March lows. Keeping score Is the bad news priced in for Rogers? There's 'too much bad news being priced into' shares of Rogers Communications Inc. (RCI/B), said analysts at TD Cowen, after the telco giants reported earnings this week. Analysts Vince Valentini, Natale Puccia and Carter Sullivan cited uncertainty around Rogers' debt outlook but the trio think 'management will be able to deliver on their strategy to improve leverage' this year. TD Cowen has a buy rating on Rogers and a price target of $57. Shares are currently trading at $46.57 and are up 41 per cent from when markets tanked in April after Donald Trump's reciprocal tariffs announcement. In other earnings related news, BMO Capital Markets analyst Tamy Chen hiked her price target for Loblaw Co. Ltd. (L) to $230 from $220 after the grocery giant reported quarterly results that beat estimates. The stock is currently trading at the $222 level. 'More Canadians are shopping in our stores. Actually, traffic is up, unit sales are up and basket growth was positive in the quarter,' Per Bank, chief executive of Loblaw said on an earnings call. TD Cowen also hiked its price target to $250 from $245. 'Assuming no major economic fallout from trade negotiations, we expect guidance to be raised after Q3,' TD analyst Michael van Aelst said. Meme mania returns Meme stocks kicked up some dust this week with shares of companies including Kohl's Corp. (KSS), Krispy Kreme Donuts Inc. (DNUT) and GoPro Inc. (GPRO) soaring as retail investors jumped back on the bandgwagon, spurred on by Redditt's WallStreetBets forum. Meme stocks often have high levels of short interest and low valuations, but its the online boosters who have drawn the most attention. The week's activity harkens back to the days of mega-meme stock GameStop Corp., whose shares rose 788 per cent in one day early in 2021 before pulling back over following few months. But, Max Gorkham, deputy chief investment officer of Franklin Templeton investment Solutions, says the meme stock run of yesterday differs from that of today. 'There was this perception of 'we're going to save this company from the evil Wall Street investors (shorting GameStop).' But I think that's part of this belief in retail traders that actually they could have an impact, even if a small one,' Gorkham said. However, he thinks this week's activity is being driven by retail traders who have made gains in crypto — bitcoin is up 20 per cent-plus this year — looking to invest elsewhere. 'We've generally seen episodes like this before, where after a strong run up in digital assets, we then see a pickup in meme names,' Gorkham said. Canfor puts down more roots Lumber company Canfor Corp.'s (CFP) purchase of three sawmills in Sweden may get some investors' attention. Canfor's footprint in Canada has been shrinking. A decade ago, 69 per cent its lumber capacity was in British Columbia compared with just 14 per cent today, while it now also has operations in Alberta, Sweden and the U.S. South. Analysts at TD Cowen like the deal given that European lumber margins are higher and less volatile in Europe than North America and has a price target of $18 on the stock. It's currently trading at around $14. Hurricanes and why investors should care Hurricane season is almost here. Analysts at Scotiabank Capital Markets identified some potential Toronto-listed winners and losers based on predictions from the U.S. National Oceanic and Atmospheric Administration that chances are high of a major increase in storm activity in the Gulf of Mexico region where plenty of oil infrastructure resides. Among the S&P/TSX composite index-listed winners could be Cenovus Energy Inc. (CVE), Imperial Oil Ltd. (IMO), and Suncor Energy Inc. (SU) as their 'downstream businesses could benefit from higher Canadian and mid-continent refined product prices. However, modestly wider WCS (Western Canada Select) differentials could partially offset the downstream tailwinds for CVE and IMO and would have the most negative impact on (Athabasca Oil Corp.) ATH and IPCO (International Petroleum Corp.). Scotiabank also warned that Gibson Energy Inc. (GBI) is exposed via its South Texas Terminal and so is Enbrige Inc. as the operator of offshore oil and gas pipelines — 'though this business is small in the context of the whole organization.' One drone stock is up almost 100%. Here's why the sky might be the limit Here's how much higher analysts think Nvidia shares can go after record run to US$4-trillion • Email: gmvsuhanic@ Every week, the Financial Post breaks down the most interesting developments in the week's world of investing, from top performers to surprising analyst calls and stocks to have on your radar. The column will take a break next week, but look for it again on Aug. 8. Are you an investor looking for stock ideas and market insight? Sign up for the weekly FP Investor Newsletter here to get the best of the Financial Post's investing news, analysis and expert commentary straight to your inbox.
