RioCan can handle Omicron

Article Excerpt

RIOCAN REAL ESTATE INVESTMENT TRUST $23 is a buy. The REIT (Toronto symbol REI.UN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Units outstanding: 317.8 million; Market cap: $7.3 billion; Price-to-sales ratio: 6.2; Distribution yield: 4.2%; TSINetwork Rating: Average; www.riocan.com) owns all or part of 210 shopping centres and other properties across Canada. With the spread of the Omicron variant of COVID-19, Ontario, Quebec and other provinces have ordered gyms, movie theatres and restaurants to close. Retail stores are also operating at reduced capacity. It’s unlikely these new shutdowns will force RioCan to cut its monthly distribution of $0.08 a unit; the annual rate of $0.96 yields 4.2%. That’s because essential retailers, such as supermarkets and drugstores, make up about 85% of its tenant base. Government supports to small businesses should also help them pay their rent. RioCan is a buy. buy…