KeyBanc Initiates Coverage On American Assets Trust With Buy Rating

According to KeyBanc, American Assets Trust AAT it is initiating coverage of American Assets Trust, Inc. (AAT-NYSE) with a BUY rating and establishing a $24 price target. KeyBanc said that it thinks shares of AAT are attractively valued today on a risk-adjusted basis, with its price target implying a ~15% expected total return for shareholders when accounting for the stock's 3.9% dividend yield. “AAT shares trade at a 6% 2011 AFFO multiple premium to the REIT average and at a 2% 2012 AFFO multiple premium to the REIT average. Moreover, AAT shares trade at a 7% implied cap rate, which is a 100 bp premium to the REIT average implied cap rate, and shares trade at an 11% discount to our NAV estimate vs. an average 13% premium to NAV for the REITs.” American Assets Trust closed on Friday at $21.68.