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e've compiled a list of the top high-growth real estate stocks that are profitable in 2024, and Realty Income Corporation (NYSE:O) is one of them. In this article, we'll examine where O stands among its peers.
The US real estate sector has seen recent updates, with the average contract rate on a 30-year fixed-rate mortgage rising to 6.36% in October, marking the highest weekly increase in over a year. This has led to a decline in refinance applications and flat purchase applications. Despite this, homebuyers who were previously hesitant are returning to the market due to lower interest rates.
According to Redfin CEO Glenn Kelman, the Fed's rate cut was late for the current season but will help many homebuyers in 2025. However, he notes that low inventory remains a major long-term problem. Nest Seekers International president and CEO Eddie Shapiro also discussed the impact of natural disasters like hurricanes on Florida's housing market, stating that it is resilient and will recover quickly.
To compile our list of high-growth real estate stocks, we started with 30 companies in the sector with the largest market caps. We then screened out those with a positive net income over the last 12 months and a 5-year net income CAGR higher than 10%. Finally, we ranked the remaining companies by their hedge fund ownership.
Realty Income Corporation (NYSE:O) is one of the top REITs in our list, with a diversified portfolio of 15,450 properties across the US, UK, and six other European countries. The company has delivered nearly 5% AFFO growth in both high and low interest rate environments and has a strong dividend track record.
With an estimated global net lease addressable market of $14 trillion, Realty Income Corporation is well-positioned for growth. Its recent announcement of the 652nd consecutive common stock monthly dividend further solidifies its position as a reliable investment. The company's AFFO per share increased by 6.0% in Q2 compared to the prior year period.
Overall, Realty Income Corporation (NYSE:O) ranks 8th on our list of high-growth real estate stocks that are profitable in 2024. While it has potential as an investment, we believe some undervalued AI stocks hold greater promise for delivering higher returns within a shorter timeframe.
