When the stock market runs into trouble, look for stocks bucking that trend and showing resilience. Keep an eye on the relative strength line to see stocks outperforming the general market, as represented by the S&P 500. One such name to watch right now is leading REIT stock Independence Realty Trust.
As a leading real estate investment trust, or REIT, Independence Realty earns a blue dot in MarketSmith, meaning its RS line is at a new 52-week high. IRT stock also earns a spot on the IBD Breakout Stocks Index as it enters and tests a new buy zone in the face of selling pressure in the stock market indexes.
Keep in mind that when the stock market drops, it takes most stocks down with it, making it a risky time to buy stocks. But keep close tabs on stocks that are showing strength in the face of market turbulence. IRT stock fits that bill, although it also pulled back Wednesday as the market got hit.
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Independence Realty Posts Spike In Sales Growth
Based in Philadelphia, Independence Realty owns and operates multifamily apartment properties across non-gateway U.S. cities (i.e., secondary markets). Markets for the real estate investment trust include Atlanta, Dallas, Columbus, Louisville, Denver, Indianapolis, Oklahoma City, Houston, Raleigh and Memphis.
The REIT's strategy focuses on gaining scale within key amenity-rich submarkets that offer good school districts, high-quality retail and major employment centers. Independence Realty has apartment properties in 122 communities.
In Q4, the company posted 42% sales growth vs. the year-ago quarter. That marked a fourth straight quarter of accelerating revenue gains.
Earnings growth came in at 14%, topping the 11% gain in Q3. Analysts expect Independence Realty to deliver 14% EPS growth for this year and a 12% rise in 2023.
IRT Stock Among Top REIT Stocks After 276% Run, Fresh Breakout
From the low it hit in April 2020 until pulling back to form its current base in January, IRT stock rose an impressive 276%. During that run, the stock generally found support right along its 10-week moving average.
After slipping below its 10-week line in January, IRT stock has reclaimed that benchmark. Now trying to deliver a fifth straight up week, the stock has shown good volume in the right side of its current chart pattern.
Using a daily chart, you can see how IRT stock formed a cup with handle showing a 24.70 buy point. The stock edged past that entry on Feb. 17 in volume 95% higher than normal. Despite selling pressure in the market indexes, Independence Realty held and added to those gains until slipping today. The stock reversed in below-average volume, closing right around the initial buy point.
While the current market environment is certainly turbulent, Independence Realty Trust continues to show market-leading strength and resilience, confirming its place as one the top REIT stocks to watch.
IBD Breakout Opportunities ETF
The IBD Breakout Opportunities ETF from Innovator Capital Management tracks the IBD Breakout Stocks Index. As with other index ETFs, this fund allows you to essentially invest in the entire index in addition to or rather than buying the individual stocks. Learn more here about the ETF and Innovator funds.
Follow Matthew Galgani on Twitter at @IBD_MGalgani.
