Forward Management, the California-based multi-strategy hedge fund that was acquired by Salient Partners last year, recently submitted its 13F filing with the SEC for the reporting period ending September 30. Forward Management was founded in 1998 and for most of its life as an independent firm was headed by J. Alan Reid, Jr., who was the CEO and director of the firm from April 2001 until March 2015. According to Forward Management’s latest filing, its US equity portfolio at the end of September was valued at almost $1.32 billion and its top-10 equity holdings accounted for over half of that value. The filing also revealed that the fund was heavily invested in the real estate and financial sectors entering the final quarter of 2016, with stocks from each of those two sector amassing 41% of the value of its equity portfolio.
In this article we are going to take a look at the five major moves made by Forward Management during the third quarter.
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New York REIT Inc (NYSE:NYRT)
– Shares Owned by Forward Management (as of September 30): 1.45 Million
– Value of the Holding (as of September 30): $13.23 Million
Let’s start with New York REIT Inc (NYSE:NYRT), in which Forward Management increased its stake by 488% during the third quarter. As the name suggests, New York REIT Inc (NYSE:NYRT) focuses on acquiring and owning office and retail properties in Manhattan. Since the start of 2016, shares of New York REIT have fallen by more than 18%. However, the real estate investment trust hasn’t reduced its monthly dividend of $0.40 per share during this period, which has pushed up its forward yield to 4.80%. On November 9, the REIT reported its third quarter results, declaring Funds from Operations (FFO) of $0.09 per share on revenue of $41.26 million, versus analysts’ estimates of FFO of $0.10 per share on revenue of $39.96 million.
Select Income REIT (NASDAQ:SIR)
– Shares Owned by Forward Management (as of September 30): 500,000
– Value of the Holding (as of September 30): $13.45 Million
Select Income REIT (NASDAQ:SIR) dropped several positions in Forward Management’s equity portfolio as the fund cut its stake in the REIT by half during the third quarter. Although shares of Select Income REIT (NASDAQ:SIR) saw a massive decline in the period between 2014 and 2015, they have performed remarkably well this year, registering gains of almost 21%. The REIT currently pays a quarterly dividend of $0.51 per share, which translates into a forward yield of 8.51%. Select Income REIT reported dismal earnings and revenue numbers last month, which prompted analysts at FBR & Co to reduce the price target on the stock to $34 from $35 on October 28, while keeping their rating on it unchanged at ‘Outperform’.
We’ll check out three more of the fund’s stock picks on the next page.