any thoughts on SCG?, page-33

USER=167466]@madamswer[/USER] - I am not sure if you have articulated your thoughts on WFD after the UB-R takeover.

Do you intend to hold on to the new scrip after the deal gets executed? If not, would you consider SCG as a good alternative for a core holding in your portfolio?

@thunderhead,

I tend to be a slow-moving beast when it comes to the making of major investing decisions; Because it is still some months away from being a done deal, if it ends up that way, I haven't started to invest the time researching the would-be acquirer of my WFD shares.

My prompt to start will be when I receive formal takeover documentation to consider, which will occur in coming weeks, I believe.

As for SCG, I agree with your views on that company: it has fine assets, and its business model is a great deal more than one of being a commercial landlord, collecting rents from its retailer tenants. Accordingly, I don't mind saying that I have been buying SCG in recent weeks, with full cognisance that I might be offered stock cheaper in the weeks/months ahead if bond yields keep spiking. But I can't invest around anticipating to what extent that might occur; all I can do is focus on valuation.

And, at current prices, which reflect a P/E of ~15.5x, and a distribution yield of 5.8%, I think SCG is indeed undervalued.

But I acknowledge that it is a bond proxy and, therefore, will almost always trade like one.