Top 10 most undervalued stocks: Morningstar

  • Morningstar said some of the biggest real estate stocks are available at discounted prices.
  • REITs offer a way to gain exposure to real estate assets while maintaining high liquidity.
  • Company analysts have revealed the 10 most undervalued real estate stocks available today.

According to investment research giant Morningstar, some of the largest real estate companies, or REITs (real estate investment trusts), are now available at substantial discounts to what analysts consider fair value.

REITs are a good addition to many investors’ portfolios because they provide a way to gain exposure to real estate while maintaining high liquidity on your investment.

A share of a REIT can be sold almost instantly in the same way as other shares, in stark contrast to the often time-consuming sales process of selling real estate.

Another great advantage is the income stream they can provide via dividend payouts. This effectively allows shareholders of a REIT to “collect rent” from tenants without the labor or costs of owning homes, offices, or retail units as a landlord.

REITs are required to pay out at least 90% of their income to investors as dividends, so payouts can be high.

There are many different REITs available in the market with varying purposes and specialties. Some target residential housing, others commerce, offices or industrial buildings. They often have a mix of property types under ownership.

Morningstar analysts scoured the market numbers and identified the 10 real estate stocks offering the best opportunities right now based on their discount to Morningstar’s fair value price.

If you’re considering taking the plunge, here’s a great place to start: