MFSI Creeps Upward
During the month of September, the MFSI rose by slightly more than 85 points. That's the second straight monthly rise for the MFSI, and its best performance in a almost a year. Despite back-to-back increases, the MFSI has declined in seven of the past 11 months. As a result of this recent rally the MFSI is now down just slightly more than 9% year-to-date. The September jump of a shade less than 3% returns the MFSI to the value it was about 14 months ago. However, the MFSI remains in negative territory year-over-year for the third straight month, this for the first time in over four years. With this increase, the MFSI finds itself about 17% off its all time high—set just eight months ago—and is more than 5% lower than it was just 12 months ago. During the past month, the value of the S&P 500 with dividends reinvested rose by almost 4% and, as a result, finds itself more than 16% above where it was one year ago.

Because the S&P 500 with dividends increased by about one percentage point more than the MFSI during the month of September, the performance gap—or percentage difference—between the two indexes decreased from 126% last month to 124% in September—it second lowest reading since May 2005. Despite the very strong 105% rise in the S&P 500 since its recent low set in October 2002, the MFSI has risen 124% during the same 59-month time period. In addition, 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 a whopping 220% while the S&P 500 with dividends reinvested has gained a meager 43%.

During the month of September, the price-to-earnings ratio (P/E) of the MFSI strengthened slightly and now stands at 19.90, while the dividend yield—defined as the total cash dividend payments divided by the current stock price, and which moves in the opposite direction—eased to 4.5%. The MFSI is an index of 21 publicly traded US-headquartered firms, including 17 REITs, principally involved in multifamily ownership and management. [ return to top ]