Our first idea is an income-property owner whose shares recently crossed above their 50-day moving average—a bullish indicator. Our second recommendation is a sale of a financial company.
Consolidated-Tomoka Land Co. (CTO)
From Upside
Founded in 1910, Consolidated-Tomoka Land (CTO) owns 36 income properties totaling more than 1.9 million square feet. A high-quality portfolio spans retail and office properties in 11 states and includes such well-known tenants as Wells Fargo, Lowe’s, and CVS. The company also owns about 8,100 acres of undeveloped land in Daytona Beach, while its leisure operations include LPGA International Golf Club.
The stock’s Overall score of 99 ranks No. 1 among its peers in Quadrix, which earn an average score of 53. Consolidated-Tomoka has a solid record of converting land and properties into steady income. In the first half of 2017, the company acquired five properties at a cost of $40 million, while selling nearly 1,670 acres of land for $39.6 million.
A solid balance sheet and surging cash flow should help sustain growth. For full-year 2017, the single analyst estimate calls for per share earnings to jump 30% to $3.70. For 2018, the per-share profit estimate is $5.49, up 48%. The stock is being initiated as a Buy.
Richard J. Moroney, CFA, Upside, www.upsidestocks.com, 800-233-5922, October 2017