This Top-Notch REIT is 42% Off its 52-Week High: Don’t Wait to Buy

This REIT is a solid choice on the TSX today if you’re looking for passive income that lasts, and a huge discount on a strong stock.

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There are a few stocks out there that offer a huge opportunity on the TSX today. Though it can be hard to decipher which will rebound quickly, and which are down perhaps for good. Yet, when it comes to this real estate investment trust (REIT), it’s one I wouldn’t wait to buy.

Down 42%, buy NorthWest REIT

NorthWest Healthcare Properties REIT (TSX:NWH.UN) offers a stellar chance to get in on both huge returns and dividends on the TSX today. There are a few reasons that I’ll get into here, but first and foremost we’ll start off with the value presented.

NorthWest REIT shares are currently down by 42% from its 52-week highs as of writing. That high was hit about a year ago, and the stock has been slumping ever since. This offers investors huge value, as the stock is trading at just 0.8 times book value.

Now, let’s get into some of the reasons why you would want to pick up this REIT now, and hold onto it for decades.

Yes, decades

Sure, it will be nice when NorthWest REIT recovers to 52-week highs. That will happen in the future. However, if you’re investing in the company, there are other reasons I would pick up this stable stock.

The stability, for one, comes from the healthcare sector. This is a sector that simply isn’t going anywhere. Yet, while you certainly could invest in a company that offers the next new big thing in drugs, you would do far better investing in healthcare properties themselves.

NorthWest REIT invests in every type of these properties, from office buildings to hospitals, providing exposure all over the world. Further, these properties have lease agreements that average 14 years, and with a current occupancy rate at a whopping 97%, the only word you can think of to describe it is stable.

And while other REITs might be sinking, earnings from NorthWest show the stock continues to thrive. Revenue increased 23% year over year in the last quarter, with assets under management (AUM) up 18.5% to $10.9 billion.

Now, the dividend

NorthWest REIT definitely offers a lot of reasons to pick up the company today, especially if you plan to hold for the next several years. However, I would understand if you’re an impatient investor wanting more cash coming in. So, of course, that’s again why NorthWest stock deserves consideration.

NorthWest REIT currently offers a dividend yield at 9.48%. That comes out as $0.80 per share on an annual basis. Below you can see then what an investment of $10,000 would bring in as of writing, compared to 52-week highs.

NWH.UN – now$8.181,222$0.80$977.60monthly
NWH.UN – highs$14714$0.80$571.20monthly

As you can see, you’ll receive almost double the amount of passive income each and every month should you choose to invest in NorthWest REIT right now. That’s with the same money you would have invested just a few months before. So take the opportunity and pick up NorthWest REIT while it remains down 42% while you can.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe has positions in NorthWest Healthcare Properties Real Estate Investment Trust. The Motley Fool recommends NorthWest Healthcare Properties Real Estate Investment Trust. The Motley Fool has a disclosure policy.

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