R
eal Estate Investment Trusts (REITs) offer a unique investment opportunity, allowing individuals to invest in real estate without directly owning or managing properties. REITs provide broad exposure and diversified portfolios, liquidity, high potential for returns, and long-term growth. They typically own and operate income-producing real estate across various sectors such as apartment buildings, cell towers, data centers, hotels, medical facilities, and offices.
The global demand for warehousing and storage facilities is rising due to the rapid growth of e-commerce, creating new avenues for REITs. The market is expected to grow at a CAGR of 2.9% until 2028. One of the key benefits of investing in REITs is their ability to distribute high and reliable dividends to shareholders on a regular basis.
REITs are required to distribute at least 90% of their taxable income to shareholders as dividends, making them an appealing choice for investors seeking passive income. Considering these trends, let's examine three fundamentally sound REIT stocks: Crown Castle Inc. (CCI), VICI Properties Inc. (VICI), and W. P. Carey Inc. (WPC).
Crown Castle Inc. (CCI) operates over 40,000 cell towers and nearly 90,000 route miles of fiber supporting small cells and fiber solutions across every major U.S. market. The company has a strong dividend history, with an annual payout of $6.26 per share, translating to a yield of 5.43% at the current share price.
VICI Properties Inc. (VICI) is an S&P 500 experiential REIT that owns one of the largest portfolios of market-leading gaming, hospitality, and entertainment destinations. VICI has increased its quarterly dividend by 4.2%, with an annual payout of $1.73 per share, yielding 5.23% at the current price.
W. P. Carey Inc. (WPC) is a leading net lease REIT with a well-diversified portfolio of high-quality commercial real estate. The company has increased its quarterly dividend to $0.88 per share, with an annual payout of $3.50, yielding 5.62% at the current price.
All three companies have strong fundamentals and are reflected in their POWR Ratings. CCI has a B grade for Momentum, Sentiment, and Quality, ranking #13 out of 45 stocks within the REITs – Diversified industry. VICI has an overall rating of B, with a B grade for Quality, Sentiment, and Momentum, topping among the 16 stocks in the REITs – Hotel industry.
WPC has a B grade for Quality, Sentiment, and Momentum, ranking #14 among the 45 stocks within the REITs – Diversified industry. These ratings indicate that these companies have solid prospects and are worth considering for investment.
