HOUSTON – Whitestone REIT (NYSE:WSR), a community-focused real estate investment trust, received a recommendation from Glass Lewis, a leading independent proxy advisory firm, for shareholders to vote in favor of all board nominees at its upcoming Annual Meeting on May 14, 2024. Glass Lewis's endorsement comes after evaluating Whitestone's operating performance and governance changes since the removal of former CEO James Mastandrea.
The advisory firm acknowledged Whitestone's transparency and willingness to consider strategic alternatives, noting significant improvements in corporate governance, including a two-thirds replacement of the board and a reshaped executive team over the past five years. Glass Lewis also addressed the governance arguments presented by Erez Asset Management, the dissident shareholder group, finding them less persuasive.
In its analysis, Glass Lewis questioned the motivations behind Erez's proposals, particularly focusing on their push for an "orderly and well-managed corporate unwind scenario," which mirrors strategies previously executed by nominee Bruce Schanzer at Cedar Realty (NYSE:CDR). The advisory firm raised concerns about Schanzer's track record, including a historical disconnect between pay and performance.
In addition, Institutional Shareholder Services (ISS) also noted Whitestone's positive turnaround and market outperformance since the appointment of the new CEO, reinforcing the market's approval of the current leadership's strategy.
The Whitestone Board of Trustees welcomed the recommendation from Glass Lewis, stating it validates the successful turnaround strategy and management changes initiated on January 18, 2022. The board warned against the potential disruption of momentum and shareholder value that could result from the election of Erez's nominees.
Whitestone emphasizes the importance of each vote and urges shareholders to use the WHITE proxy card to support the current board nominees, advising them to discard any BLUE proxy materials received from Erez.
The company continues to evaluate opportunities to maximize shareholder value and remains open to selling the company or exploring strategic alternatives if beneficial. However, Whitestone cautions against a premature sale process under current market conditions, as suggested by Erez.
InvestingPro Insights
Whitestone REIT (NYSE:WSR) appears to be on a stable financial footing, according to recent data from InvestingPro. With a market capitalization of $596.44M and a noteworthy gross profit margin of 68.49% over the last twelve months as of Q1 2024, the company's financial health is evident. This is further supported by a solid operating income margin of 30.16% in the same period. These metrics underscore the company's efficient management and profitability, aligning with the positive turnaround noted by Institutional Shareholder Services (ISS).
An InvestingPro Tip for Whitestone REIT highlights that the company has been consistent with its dividend payments, maintaining them for 15 consecutive years. This could be particularly appealing to income-focused investors, especially considering the company's dividend yield stood at 4.27% as of the latest data. Additionally, the company's liquid assets exceed its short-term obligations, suggesting a strong liquidity position that may reassure investors of its ability to meet immediate financial responsibilities.
For those looking to delve deeper into Whitestone REIT's performance and future prospects, InvestingPro offers additional insights. There are more InvestingPro Tips available, providing a comprehensive analysis to help investors make informed decisions. To explore these further, one can visit https://www.investing.com/pro/WSR. Remember to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking even more valuable investment information.
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