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No. of Recommendations: 1
While we still think a sale is possible, we'd be on the sidelines as we do not believe the stock closes the valuation gap with comps

I guess, I am going to be contrarian or at least going to disagree with this analyst's call. The company cleared the air on the lease renewal. Generally, when a lease expires REIT's have an opportunity to "tru up" or raise the rent to market rates, but this is one of those rare cases where the rent is going to be reduced to bring it to "market rate". The reduction is going to be 20% (mid-point company guidance). That is a significant headwind. So our analysts will do the basic excel sheet math and adjust the FFO and issue new price objective based on company guidance. Once the reset is done, the lease overhang is out of the way, you can compare the comp-rate to the peers.

IF I am someone having 25x FFO multiple, and there is an asset (quality asset) that is trading at 20x FFO, I can use my genius skills and issue equity at 25x FFO and acquire assets at 20 FFO. The industry is consolidating, so it is a matter of time. Either the stock get re-rated with peer multiples or taken out.

Now, if the stock can get to $60....
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