When a real estate investment trust (REIT) trades below book value, it’s in the bargain basement of stock market offerings. When that REIT offers a dividend, the investor receives payment just for holding the cheap security. It can be a sweet combination of factors — as long as other important metrics align favorably.
While specific segments of the commercial real estate (CRE) market such as industrial and healthcare are performing well, others like office and retail are alarming investors.
Rising interest rates are heightening those concerns. In response, investors are actively reducing their exposure to the CRE market.
Income investors sometimes look for higher-dividend yields on low-priced stocks. But buying stocks below $10 can be a high-risk venture as these stocks are usually cheap for good reasons. Therefore, it is usually better to purchase stocks above $10.
On CNBC’s "Mad Money Lightning Round," Jim Cramer said he likes Cisco Systems Inc (NASDAQ: CSCO). "When it snaps back, it’s going to snap back big," he added.