These 3 Dividend Stocks Just Reported Strong Earnings. Here's the One I'm Buying Now.
Three real estate stocks recently raised their guidance. One stands out for income investors.
Three REITs—Realty Income, Empire State Realty Trust, and Ryman Hospitality Properties—released their third-quarter earnings recently. All three companies raised their full-year guidance. Realty Income, Empire State Realty Trust, and Ryman Hospitality Properties reported record third-quarter revenue, increased AFFO (adjusted funds from operations), and raised their full-year guidance.
However, Ryman's entertainment segment experienced a 41% decline in operating income. Empire State Realty Trust owns Manhattan office buildings, and its office space is nearly fully leased. The observatory at the Empire State Building faced a 41% revenue drop and 41% net operating income decline. Realty Income owns about 15,500 single-tenant properties under long-term net leases, which are mostly occupied by retail tenants.
It has paid 676 consecutive monthly dividends and raised its payout for 116 straight quarters. Realty Income's dividend yield is about 5.5%, and it's trading at 13x AFFO, making it cheaper than Ryman but less cheap than Empire State Realty. The article recommends adding shares of Realty Income due to its reliable dividends, AFFO growth, and lower volatility compared to the other two stocks.
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