Wednesday, June 24, 2009

Merrill's New REIT Teams Marks REIT Territory

The brand spanking new team (and legacy boy Craig Schmidt) that Merrill recently acquired from some other bank (I wrote about this, but frankly don't remember where these clowns came from nor do I care), just went to town all over the REIT bathroom and marked their territory effusively. ML in fact distributed a 45 page reinitiation report, which I have no intention of ever reading. The summary ratings and price targets are below.

Is it just me or does Merrill have a Sell (and $4.50 price target) on recent Goldman Conviction Buy List and Greatest REIT Pick Ever CBL & Associates? Oh wait, Goldman in fact had some nice rah-rahish words on CBL earlier today did it not.

So... same company and yet: Merrill at Sell - $4.50 PT, Goldman at Buy - $10.00 PT. That's a pretty wide differential, and indicative again that nobody has any idea what the hell is going on with REITs (except for State Street of course which is still making shorting of REITs impossible).

We venture to guess: Goldman prop desk is very heavy with big CBL exposure they need to offload: Merrill - vice versa. Sounds like some great synergies can be extracted here. Goldman prop - meet Merrill prop (or the 3 traders that are still left there).

And, indeed, GS still has about 370k shares it needs to offload (to join the 500k or so it already sold last quarter).

hat tip Ed Sphere: Related Content
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