We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is Realty Income's (O) 113th Monthly Dividend Hike Sustainable?
Read MoreHide Full Article
Realty Income Corporation (O - Free Report) recently announced its 113th common stock monthly dividend hike since the company’s NYSE listing in 1994. The company will pay 24.6 cents per share in dividend compared with the 23.6 cents paid earlier, denoting a 5.1% hike compared to the same month in 2020.
The increased dividend will be paid on Dec 15, to shareholders on record as of Dec 1, 2021. The latest dividend rate marks an annualized amount of $2.952 per share versus the prior rate of $2.832. Based on the company’s share price of $71.41 on Nov 16, it results in a dividend yield of 4.13%.
Solid dividend payouts are the biggest enticement for the REIT investors and Realty Income is committed to boosting shareholder wealth. This retail REIT enjoys a trademark of the phrase “The Monthly Dividend Company.”
The latest hike comes by a marginal figure from the prior dividend paid, but the December dividend payment marks the company’s 617th consecutive monthly dividend payment in its 52-year operating history. O has made 96 consecutive quarterly dividend hikes. The retail REIT has witnessed compound average annual dividend growth of 4.5% since its listing on the NYSE.
The latest hike reflects Realty Income’s ability to generate decent cash-flow growth through its operating platform and a high-quality portfolio. Realty Income announced the closing of the merger with VEREIT on Nov 1. The combined entity is poised to benefit from the enhanced size, scale, diversification and synergies. Also, Realty Income has announced the completion of the spin-off of Orion Office REIT Inc. (ONL - Free Report) .
According to Sumit Roy, president and the chief executive officer of Realty Income, "Following the closing of our recent merger, our continued operational success and favorable outlook has allowed us to increase the dividend for the 113th time since our company's public listing in 1994."
With the current cash-flow growth rate of 4.33%, as against the industry’s average of a negative 21.22%, the increased dividend is likely to be sustainable.
Realty Income derives 95% of its annualized retail contractual rental revenues from the tenants with a service, non-discretionary and/or low-price-point component to their business. Such businesses are less susceptible to economic recessions and competition from Internet retailing. This boosts the stability of rental revenues and generates predictable cash flows.
Realty Income exited third-quarter 2021 with a cash balance of $517.0 million. The company has a $3.0 billion unsecured revolving credit facility and as of Sep 30, 2021, there were no borrowings on its revolving credit facility. The company ended the quarter with modest leverage and strong coverage metrics. Further, Realty Income has a credit rating of A- and A3 from Standard & Poor’s and Moody’s, respectively, enabling it to procure debt financing at attractive costs.
Simon Property Group (SPG - Free Report) holds a Zacks Rank of 2, at present and its projected long-term growth rate is 8.70%.
The Zacks Consensus Estimate for Simon Property’s 2021 FFO per share has been revised marginally upward in a week.
Federal Realty Investment Trust’s (FRT - Free Report) Zacks Consensus Estimate for the ongoing-year FFO per share has moved 1.5% north to $5.32 over the past week.
Currently, Federal Realty carries a Zacks Rank of 2.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Shutterstock
Is Realty Income's (O) 113th Monthly Dividend Hike Sustainable?
Realty Income Corporation (O - Free Report) recently announced its 113th common stock monthly dividend hike since the company’s NYSE listing in 1994. The company will pay 24.6 cents per share in dividend compared with the 23.6 cents paid earlier, denoting a 5.1% hike compared to the same month in 2020.
The increased dividend will be paid on Dec 15, to shareholders on record as of Dec 1, 2021. The latest dividend rate marks an annualized amount of $2.952 per share versus the prior rate of $2.832. Based on the company’s share price of $71.41 on Nov 16, it results in a dividend yield of 4.13%.
Solid dividend payouts are the biggest enticement for the REIT investors and Realty Income is committed to boosting shareholder wealth. This retail REIT enjoys a trademark of the phrase “The Monthly Dividend Company.”
The latest hike comes by a marginal figure from the prior dividend paid, but the December dividend payment marks the company’s 617th consecutive monthly dividend payment in its 52-year operating history. O has made 96 consecutive quarterly dividend hikes. The retail REIT has witnessed compound average annual dividend growth of 4.5% since its listing on the NYSE.
The latest hike reflects Realty Income’s ability to generate decent cash-flow growth through its operating platform and a high-quality portfolio. Realty Income announced the closing of the merger with VEREIT on Nov 1. The combined entity is poised to benefit from the enhanced size, scale, diversification and synergies. Also, Realty Income has announced the completion of the spin-off of Orion Office REIT Inc. (ONL - Free Report) .
According to Sumit Roy, president and the chief executive officer of Realty Income, "Following the closing of our recent merger, our continued operational success and favorable outlook has allowed us to increase the dividend for the 113th time since our company's public listing in 1994."
With the current cash-flow growth rate of 4.33%, as against the industry’s average of a negative 21.22%, the increased dividend is likely to be sustainable.
Realty Income derives 95% of its annualized retail contractual rental revenues from the tenants with a service, non-discretionary and/or low-price-point component to their business. Such businesses are less susceptible to economic recessions and competition from Internet retailing. This boosts the stability of rental revenues and generates predictable cash flows.
Realty Income exited third-quarter 2021 with a cash balance of $517.0 million. The company has a $3.0 billion unsecured revolving credit facility and as of Sep 30, 2021, there were no borrowings on its revolving credit facility. The company ended the quarter with modest leverage and strong coverage metrics. Further, Realty Income has a credit rating of A- and A3 from Standard & Poor’s and Moody’s, respectively, enabling it to procure debt financing at attractive costs.
Shares of Zacks Rank #3 (Hold) O have gained 9.1% in the past six months compared with the industry’s rally of 6.9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stocks to Consider
Simon Property Group (SPG - Free Report) holds a Zacks Rank of 2, at present and its projected long-term growth rate is 8.70%.
The Zacks Consensus Estimate for Simon Property’s 2021 FFO per share has been revised marginally upward in a week.
Federal Realty Investment Trust’s (FRT - Free Report) Zacks Consensus Estimate for the ongoing-year FFO per share has moved 1.5% north to $5.32 over the past week.
Currently, Federal Realty carries a Zacks Rank of 2.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.