MFSI Making a Very Slow Recovery
During the month of July the MFSI rose by 56 points. With this monthly increase the MFSI is now down slightly more than 42% over the past 12 months, and its 12 month performance has been negative for 23 of the past 24 months — its worst performance ever.

The July increase of slightly more than 3% returns the MFSI to a level last seen in early 2004 — well over five years ago. Moreover, despite this latest rise, the MFSI finds itself still 2,075 points, or almost 54%, off its all-time high reached in January 2007. During the past month, the value of the S&P 500 with dividends reinvested jumped by slightly less than 8% and now finds itself down slightly less than 20% over the past 12 months, the first time it has been in negative territory for 18 straight months year-over-year in well over six years. 

Because the S&P 500 with dividends increased by close to 8% while the MFSI rose by a more modest 3%, or by more than twice as much, during the month of July, the performance gap — or percentage difference — between the two indexes decreased from 91% last month to 84%. Since its cyclical low set in October 2002, the S&P 500 with dividends has increased by 39%, while the MFSI has increased by a nearly identical 32% during the same 78-month time period. And the MFSI continues to dramatically outperform the S&P 500 over longer time periods including the past five, six and seven years. 

Since December 1998, the MFSI has risen by 77% while the S&P 500 with dividends reinvested has declined by slightly more than 3%. During the month of May, the price-to-earnings ratio (P/E) of the MFSI rose and now stands at 10.99 while the dividend yield, defined as the total cash dividend payments divided by the current stock price, and which moves in the opposite direction, declined to 11.60%. The MFSI is an index of 18 publicly traded US headquartered firms, including 16 REITs, principally involved in multifamily ownership and management. [ return to top ]