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Tricon Residential Soars as Activist Investor Pitches Potential Upside

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Tricon Residential Soars as Activist Investor Pitches Potential Upside

Tricon Residential (NYSE:TCN) saw its stock rise 4% on Tuesday following a presentation by activist investor Land & Buildings Investment Management. At the 13D Active-Passive Investor Summit in New York, Land & Buildings revealed its ownership of Tricon Residential and expressed optimism about the company’s future prospects.

Land & Buildings argued that Tricon Residential, which specializes in single-family rental homes, is currently undervalued and has the potential to increase its share price by a substantial 65%. They highlighted the company’s favorable valuation compared to its peers, with a 7% implied cap rate and a discount of 150-250 basis points. Additionally, Land & Buildings pointed out recent transaction activity that further supports the company’s solid position in the market.

An area of focus for Land & Buildings is Tricon Residential’s overhead costs, which they contend are significantly higher than its single-family rental peers on a per-home basis. They believe that reducing these costs to align with industry standards could result in a substantial increase of 30% or more in earnings.

In conclusion, Land & Buildings’ presentation emphasized the potential upside for Tricon Residential and the importance of addressing its overhead costs. This news has sparked investor interest and contributed to the recent increase in the company’s stock price.