Value investing involves buying cheap stocks that are out of favor with the market, despite potential concerns. Rexford Industrial and Toronto-Dominion Bank are currently in this position, with historically high dividend yields. Rexford focuses on the Southern California warehouse market, which is highly attractive due to its size, low vacancy rate, and limited supply. Despite concerns about slowing rental increases, the company’s focus on redevelopment and growth bode well for long-term investors. Toronto-Dominion Bank is a major player in the banking industry, offering a high dividend yield and a history of dividend consistency. While there are potential headwinds, such as the cooling Canadian housing market, the bank is well-prepared to navigate challenges.
Rexford Industrial recently announced strong first-quarter results, with a 20.3% increase in funds from operations. Despite this, the stock price has dropped, leading to a high dividend yield of around 10%. The company’s focus on redevelopment and growth makes it an attractive option for dividend growth investors. Toronto-Dominion Bank, on the other hand, is facing challenges in the Canadian housing market and regulatory concerns in the U.S. Despite this, the bank’s strong Tier 1 Capital ratio and potential for organic growth indicate resilience in the face of adversity.
Investing in cheap stocks often means taking on stocks with some imperfections. Rexford and TD Bank are currently out of favor in the market, leading to high dividend yields. If you are willing to endure some near-term uncertainty, both stocks present attractive opportunities for dividend investors. By buying when others are scared, investors can potentially benefit from the eventual turnaround in these undervalued stocks.
The Motley Fool Stock Advisor team has identified 10 stocks with high potential for future growth, but Rexford Industrial Realty is not among them. This service provides investors with guidance on building a successful portfolio and offers regular updates from analysts. If investors seek to replicate the success of past recommendations, such as Nvidia, they may consider exploring the recommended stocks for potential returns. Ultimately, investing in undervalued stocks like Rexford and TD Bank requires patience and confidence in the long-term outlook of the companies.
