Green Shoots in Bombed-Out Sector

New turnaround investment opportunity in a sector left for dead

As a contrarian value investor, I like to sniff around bombed-out sectors left for dead to check for green shoots, i.e. an approaching upward inflection point.

Investing in such sectors like offshore drilling, oil/coal, and automotive suppliers have yielded good results in the past, and I am using the same playbook to initiate a new position in another bombed-out sector: the real estate industry.

The stock I have purchased for the Hidden Rock Capital Model Portfolio is a leading asset-light real estate company which is trading for a fraction of its historical valuation multiples, based on my estimate of its normalized earnings power going forward.

Let’s dive in!