Buy NexPoint Diversified (NXDT)

NexPoint Diversified REIT Investment Case

June 15, 2022

Ticker: NXDT

Price: $15.23

Market Cap: $565MM

Price Target: $25

Upside: +64%

Summary:

NexPoint (NXDT) is a closed end fund that is transitioning into a real estate investment trust (REIT). It trades at a 40% discount to NAV and is significantly below where it traded pre-pandemic. Once the transition to REIT is complete, it will be eligible for many more investors to own including funds and ETFs. This will likely drive indiscriminate buying pressure. The CEO of the company owns 25% of the company and has been buying the stock in the open market relentlessly. A near-term re-rate to NAV could drive 50%+ upside, but longer term, a bigger opportunity could materialize as the REIT is repositioned to capture value.

Resources

Podcast Where I pitch NXDT

Clark Street Value Write Up

Good Write Up on Seeking Alpha