ChristopherCarrollSmith

Lexington Property Trust a defensive growth stock for October

Long
NYSE:LXP   LXP Industrial Trust
LXP blew away analyst expectations on its last earnings report, beating by 200%. It got a nice pop after earnings , then collapsed when it announced a $10 million share offering. It started to recover after it announced what it was doing with the money raised from investors: purchasing new properties to accelerate its growth. If LXP is as good a steward of the new properties as it has been so far, I'm not worried about the share offering; it should propel the company's expansion rather than dilute my shares. LXP has a 9.5/10 Equity StarMine Summary Score and is rated "undervalued" by the fundamental analysts at S&P Capital IQ .

Amidst the coming "earnings recession" this quarter, real estate is expected to be one of the few sectors that outperform. The sector as a whole is overbought, but LXP is a better value than most real estate stocks, having dipped to mid-RSI channel ahead of its ex-dividend date tomorrow. LXP pays a dividend of 10 cents per share, down from 18 cents per share last fiscal year. (I actually like a lower dividend, because it gives the company more capital to reinvest.) Unlike many dividend stocks, which take a big hit after the ex-dividend date, LXP's price usually takes its hit before the dividend and then recovers after. In my opinion this is a pretty good bet to buy ahead of the dividend and hold as value/growth stock for October.

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