Company Description
Boston Properties is a fully integrated, self-administered and
self-managed real estate investment trust that develops,
redevelops, acquires, manages, operates and owns a diverse
portfolio of Class-A office, industrial and hotel properties. The
Company is one of the largest owners and developers of Class-A
office properties in the United States, concentrated in four core
markets -- Boston, Midtown Manhattan, Washington, D.C. and San
Francisco.
[Source: Company Press Release]
Reasons to Invest:
Just over six months ago, I featured an article entitled "A
Cornucopia of Candidates." In that article, I wrote up Boston
Properties (NYSE:BXP) as a watch list candidate. Since this
write up, BXP has gained 16.58, or 36%. The stock has been
rising through a tightly knit regression channel, testing the top
and bottom bars of support/resistance along the way. After
looking at Boston Properties chart, I feel that it is time to
make it a true hypothetical portfolio candidate. Below you will
find the original write-up posted on May 21st, followed by a brief
synopsis of why I still like BXP as a dividend reinvestment plan.
Original Write-Up (May 21st, 2004)
Boston Properties Inc (NYSE:BXP) is the first candidate for the
watch list. In the past four weeks BXP jumped to the middle of
its industry in regards to price performance. This can be seen as
a positive, especially since the stock was trading in the bottom
ten percent of its industry over the past six months.
I also see a low risk rating on BXP for entries into their stock.
They have a dividend percentage growth rate outlook of 3.73
percent over the next year, 7.01 percent over the next three
years and 8.80 percent over the next five years. On top of that
they expect their sales to grow by 10.53 percent over the next
year, 13.76 percent over the next three years, and 20.58 percent
over the next five years.
In February, Boston Properties, Inc signed two new leases in the
Times Square Tower. The leases total 131,807 square feet, and are
expected to be the new home of two additional prominent law
firms.
BXP has a revised bullish price objective of 64.00 on their point
and figure chart. While this estimate appears to be pretty high
for a stock that has just recently bounced off of support at
43.00. I am optimistic that we could see returns to 55.00 by
year-end and possibly onto the 64 range by next year.
BXP currently yields a hefty annual dividend of $2.60, or 5.78%
per share owned. Their next dividend payout is tentatively
scheduled for June 28th, 2004.
End Original Write-Up
While the past six months are behind us, I still see future
growth in BXP for several reasons. First and foremost, BXP's
track record has been impressive. After all the stock has set
new all time highs for the past four consecutive months. In my
initial write-up I noted that I expected to see BXP hit 55 by
year-end. Low and behold here we are six and a half months later
and the stock is pressuring its Point-and-Figure price objective
of 64. Generally a price objective is revised (higher/lower)
when the stock continues its trend straight through its price
objective, and I see this happening fairly soon. Perhaps the
only more interesting thing to note about the groove that Boston
Properties is in is the fact that its underlying moving averages
have served as support for the stock on nearly every retest.
Revenues for this real estate investment trust company are up 7%
over the first three quarters of 2004. The increase in revenues
is cited to be a direct reflection of higher rental rates on new
leases and rollovers. BXP expect to see a full fiscal year 2005
EPS of $2.30-$2.45 and FFO of $4.10-$4.25 per diluted share.
Analysts are estimating an FFO of $4.13 per diluted share for
Boston Properties. Dividend percentage and sales percentage
growth rates are the same as listed in the initial write-up.
Interestingly enough, Boston Properties ranks in the top 15-17
percent of its industry over the past 26 weeks, but they rank in
the lower half of their industry over the past 13 weeks. I find
this odd, especially since the company has yet to significantly
pull out of its regression channel, and has continued to set new
all-time highs over the past four months.
Lastly, I am intrigued by the fact that daily, weekly, monthly,
quarterly, and yearly charts are show buy signals on the MACD and
Stochastics indicators. Volume for the stock has remained
positive, and the stock has an average true range (daily trading
range average) of 1.11, which means that we should see movement
on a daily basis, regardless of whether or not that movement is
up or down.
The company still divvies out a $2.60 annual dividend per share
owned.
Editor's Note:
I have received numerous emails from our faithful readers
asking/requesting that I feature a DRIP that is worthy of
investing in for a new grandchild. On top of that I have had
repeated requests for my top three DRIP recommendations right
now. I am currently working on an end-of-year article that
features my top five for 2005. In that article I will dedicate
one or two of those DRIPs towards companies that I expect would
be a good investment for a new grandchild. Look for this article
to be published near the end of December or beginning of January.
I know you will find the information enjoyable and highly
educational. Have a great week.
This ends another exciting episode of the DripAdvisor.com Drip of
the Week. Stay tuned next week, as we will spotlight another
stock worthy of the DripAdvisor.com limelight.
Remember:
Plan your trade, and trade your plan.
Until Next Week,
Nich Sheldon
Editor In Chief
www.dripadvisor.com
questions@DripAdvisor.com
Broker Recommendations
Strong Buy 2
Buy 4
Hold 9
Sell 2
Strong Sell 0
Brokers Covering 17
DRIP Information:
Shares to Qualify = 1
Auto-reinvestment = Yes
Accept Foreign Accounts: Yes
Temper Enrollment: Yes
Min/Max Investment = $100-$25,000/quarter
Reinvestment Fees -
Dividend investment fees: 0
Cash investment fees: 0
Auto reinvestment fees: 0
Transfer Agent:
BankBoston
888-485-2389
Corporate Headquarters:
111 Huntington Avenue
Boston, MA 02199
Phone: (617) 236-3300
Fax: (617) 536-3128
