Great Lakes REIT Inc. downgraded to "sell"

03/10/03 - A.G. Edwards & Sons

NEW YORK, March 10 (New Ratings) - Analysts at A. G. Edwards Financials downgrade Great Lakes REIT Inc. (GL) from "hold" to "sell." The target price is set to $11.00-$11.50 per share range.

Shares of Great Lakes REIT Inc, a real estate investment trust, are currently trading at $15.38.

According to A. G. Edwards’ research note, the company is receiving weak response in the investment market, leading to lower portfolio value, falling replacement rents and negative flow of funds. This, the analysts say, may lead to a reduction in the company’s dividend of $1.62. The analysts suggest that the dividend levels should be lowered according to the level of the company’s share valuations.

A.G. Edwards believes that the industry is also witnessing a market downtrend and a weak employment market, which is not expected to recover before 2004. The analysts expect investors to invest in more attractively valued stocks than those of Great Lakes. The company’s growth strategy to acquire non-performing assets may be the only glimmer of hope, add the analysts.

The EPS estimates for 2003 and 2004 are $1.79 and $1.49, respectively. The EPS for 2002 is $2.14. The P/E for 2002 is 8.6x and the estimates for 2003 and 2004 are 8.6x and 10.6x, respectively.

A.G. Edwards Financials downgrades Great Lakes REIT inc. from "hold" to "sell."