Our "Dividend Warrior" Prediction Is Coming True

In late July, I told you that real estate investment trusts, or "REITs" for short, were some of the most misunderstood investments out there.

Sadly, it's a misunderstanding that has left hundreds... maybe even thousands... of would-be millionaires starving for badly needed income.

But not us.

Our 10-Minute Millionaire system is designed to sleuth out the best opportunities in the market.

That means it's immune to common market misconceptions that could make you miss out on unworldly gains.

As proof, we added the perfect hospitality REIT to our portfolio - RLJ Lodging Trust (NYSE: RLJ).

With this trade, we tapped into a rare profit opportunity - one that I predicted would be a top performer in our 10-Minute Millionaire portfolio.

And that prediction is starting to ring true.

After experiencing a pullback with the rest of the REIT sector early on, RLJ is on the path to a terrific recovery.

With this trade moving firmly into the green, I want to share the vital lesson this "Dividend Warrior" has to teach...

An Impressive Specimen

Before I breakdown RLJ's recent movement, it's important to remember exactly how this REIT operates.

RLJ owns and operates hotels with a business focus - the mid-tier offerings of big hotel brands like Marriott's Renaissance and Courtyard, Hyatt Place and Hilton's Embassy Suites, Garden Inn and Homewood Suites.

They have limited food and beverage outlets, modest meeting space, and they concentrate on one thing - filling up hotel rooms.

And because they do not try to be a jack-of-a-trades like big, full-service hotels, they can operate with a much trimmer full-time staff.  And compared to their larger cousins, these hotels have higher revenue per room and profit margins.

And with smaller buildings (and the accompanying smaller price tags), they also offer the potential for a greater return on investment.

These are the folks that RLJ caters to.

And it's what makes it such an exciting hospitality REIT play.

With a portfolio of over 122 properties, with approximately 20,100 rooms, located in 21 states and the District of Columbia, RLJ is an impressive specimen in the hospitality REIT space.

The Two Aces Up Our Sleeve

When we look at this Bethesda-based hospitality REIT, RLJ has two aces up its sleeve...

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  • The long-term ace is the company's incredible dividend. Currently, RLJ delivers an annual dividend of 6.38%, making this a stock that is "easy to hold" as we wait for appreciation of its assets to drive up the stock price.
  • However, the short-term ace is the real tantalizing opportunity. On July 20, Blackstone Group LP, one of the largest money management firms in the world, placed a $3 billion bid to acquire RLJ. RLJ ultimately turned down the offer, but it was still great news for RLJ investors. If a company with Blackstone's reputation was interested, that means that other firms could be interested as well. That means there is a real possibility of a takeover bid that could further boost the stock in the future.

Now, when we bought into this stock, we focused on it because it gave us both a multiyear Extreme Reversal and then followed that up now with a Continuation Extreme.

Here's what the original chart looked like...

Unfortunately, not long after we bought into this trade, the stock pulled back along with rest of the broader REIT sector.

However, since then, it has made a terrific recovery into positive territory.

Let's look at the chart...

RLJ has climbed 15% off its recent lows thanks to two things:

  • The company got excellent news after Hurricanes Harvey, Irma, and Maria passed through leaving tragedy and long-term recoveries in their wake. RLJ announced that none of its properties in Houston, Florida, or Georgia received damage. In fact, all of its Houston properties continued to operate while providing humanitarian aid, and its Florida properties were only closed for mandatory evacuation periods. The reopenings that quickly followed were incredible news for a REIT that makes its money from filling hotel rooms.
  • The second issue is that commercial REITs are much less sensitive to interest rates than residential REITs.

We can see both of these items reflected in the price chart above.

Patience Pays

When a new investment pulls back early in the process, it's easy to second-guess your investment premise.

For the first time, D.R. Barton's sharing the secret that made him a self-made millionaire. His 10-minute, three-step system empowers investors to double or triple their money without being tied to a trading screen. And the best part is, it's absolutely free. So click here to get his 10-Minute Millionaire every week, and get started on the path to your first million.

A rocky start makes it so much more likely that an investor will succumb to their emotions and they will ultimately get shaken out of their position.

The keyword is patience.

With RLJ, we're looking at an intermediate-term profit opportunity. For these types of trades, we've got a slightly longer view in mind. We're looking at a range anywhere from a few weeks to three to five months.

The bottom line is letting a well-run company execute well while absorbing the short-term ups and downs is part of the 10-Minute Millionaire way.

For now, we'll maintain our stop-loss at 20% below our entry point, and we'll look to "Book the Profits" on half of our shares once we have a 40% gain. We'll let the second half of our RLJ stake run as we enjoy the incredible dividend during the ride.

Potential $50,000 Payday Lined Up: Today, D.R. Barton, a self-made millionaire who has already shown his paid subscribers an incredible 33 triple-digit windfall opportunities this year alone, is making a big announcement. His Hook Pattern strategy has been giving folks a chance to make large cash windfalls – $4,598, $8,000, $3,800, $6,100 – usually on just one or two trades. And now he's spotted two extraordinary "Hooks" that are about to soar. He wants to show you how easy it is to begin collecting thousands of dollars a month. Details here.

The post Our "Dividend Warrior" Prediction Is Coming True appeared first on 10-Minute Millionaire.

About the Author

D.R. Barton, Jr., Technical Trading Specialist for Money Map Press, is a world-renowned authority on technical trading with 25 years of experience. He spent the first part of his career as a chemical engineer with DuPont. During this time, he researched and developed the trading secrets that led to his first successful research service. Thanks to the wealth he was able to create for himself and his followers, D.R. retired early to pursue his passion for investing and showing fellow investors how to build toward financial freedom.

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