Insiders Are Selling Shares of Hormel Foods Corp (HRL), HollyFrontier Corp (HFC), and This REIT

According to a Form 4 filing, one member of Eastgroup Properties Inc. (NYSE:EGP)’s Board of Directors discarded a sizable block of shares last week. Chairman David H. Hoster II, former Chief Executive Officer of the self-administered real estate investment trust (REIT), sold 24,208 shares last Thursday at prices varying from $60.00 to $60.04 per share, trimming his direct ownership stake to 205,493 shares. Mr. Hoster also holds an indirect ownership stake of 50,000 shares in a family trust for the benefit of his children. The REIT focuses on the development, acquisition and operation of industrial properties in major Sunbelt markets across the United States, primarily focusing on the states of Florida, Texas, Arizona, California and North Carolina.

During 2015, Eastgroup Properties acquired two warehouse distribution complexes and 112.6 acres of development land for $50.9 million. Moreover, the company also started the construction of 11 development projects, as well as transferred 17 properties from its development program to real estate properties. Therefore, the REIT appears to have been quite successful in growing its business throughout 2015. Eastgroup Properties generated funds from operations (FFO) of $118.17 million in 2015, up from $109.00 million in 2014. The REIT’s property net operating income (PNOI) increased by $10.66 million to $167.51 million in 2015, as a result of an increase of $6.31 million from newly-developed properties, $3.03 million from same-property operations, as well as $2.61 million from acquisitions. Moreover, leases expired on 6.83 million square feet during 2015, which accounted for 19.6% of total square footage, but the company successfully renewed and re-leased 90% of the expiring square feet. What’s more, leases on 13.5% of the REIT’s portfolio were scheduled to expire in 2016, but the percentage has already dropped to 10.6% of the portfolio through mid-February.

Shares of Eastgroup Properties are 7% in the green year-to-date but trade at a rather expensive forward P/E of 34.2. The REIT offers an annualized dividend rate of $2.40 per share, which equates to a dividend yield of 4.01%. D.E. Shaw & Co., founded by David E. Shaw, owns 47,355 shares of Eastgroup Properties Inc. (NYSE:EGP) as of the end of December.