NEW ON THE BLOCK
get mesmerized by yields.
“With REITS, utilities and other high-dividend stocks, a lot of people are chasing yield,” he said. “In general, we think REITs are awfully expensive.”
Rather than IPOs, Papp prefers to buy shares in corporations after they have been trading awhile.
The recent influx of public companies is good news for Arizona, though the heavy concentration of real-estate firms might be a mixed blessing. If the state wants to diversify its economy more to mitigate those sharp cyclical real-estate swings, it would be nice to see more banks, consumer-products companies, manufacturers or other types of companies set up headquarters here.
Stephen Barnes of Barnes Investment Advisory in Phoenix cites the increase in realestate companies, especially IPOs, as a sign that properties aren’t the screaming deals they had been fairly recently.
“These companies weren’t selling shares when their assets were cheap,” Barnes said. “We might have passed the best point to buy in this cycle.” Arizona public companies’ ranks have been boosted by these additions, shown with ticker symbols: American Residential Properties (ARPI): The Scottsdale REIT, which has a portfolio of single-family homes, sold $288 million worth of shares in the stock market Thursday. AV Homes (AVHI): The Scottsdalebased developer, which relocated to Arizona last year from Florida, is worth about $165 million. Healthcare Trust of America (HTA): The Scottsdale-based REIT owns medical-office buildings and other health properties. It had a stock offering in June. Insys Therapeutics (INSY): The Phoenix pharmaceutical company provides treatments to ease cancer discomfort and had an IPO on May 2. It ranks among Arizona’s smaller companies in stock-market value. LifeLock (LOCK): The Tempe-based provider of identity-theft-protection services is worth about $850 million after an IPO in October. Spirit Realty Capital (SRC): The Scottsdale-based REIT sold shares in September and is worth about $1.8 billion now. Taylor Morrison Home Corp. (TMHC): The Scottsdale homebuilder sold nearly $630 million of stock in April in the nation’s fourth-largest IPO this year.