AAs a longtime Fool contributor and Senior REIT Analyst for our Millionacres real estate brand, I have invested in numerous REITs. In fact, real estate investment trusts represent seven of my 20 largest equity positions. However, Real estate income (NYSE: O) was the very first REIT I have ever purchased, and it remains one of my largest investments. In this fool live Video clip, recorded July 16, on a show with my fellow contributor Brian Withers and Chief Growth Officer Anand Chokkavelu where we ranked my top 20 positions in equities, I discuss why I’m such a fan.
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Matt Frankel: My biggest surprise here is how much we disagreed about Realty Income. It was my number 5, and you were 12 and 18. Since 1994, they’ve produced something like a 3800% total return. An investment of $ 10,000 would be worth nearly $ 400,000 in this business. It’s like a 40 bagger in less than 30 years, Anand. I know it’s not that long term, but you can’t dispute that.
Anand Chokkavelu: To be fair, it was all Anand’s ignorance discount. It was the first of the REITs and stuff for me. It was 12 for that. I know you’re on the cutting edge of technology and looking at it, I mean he has a good dividend, a great portfolio, and a track record. Yes, I would trust Matt’s # 5 ranking over my # 12.
Brian Withers: Unfortunately, the way I see it, I’m really not looking at companies that are capable of increasing their bottom line. I look more at revenue growth, and these guys have had single digits for the last three quarters.
Frankel: Real quick, let me show you one thing. These are the statistics from Realty Income. Since its listing on the New York Stock Exchange in 1994, 15.3% annualized returns have paid 612 consecutive monthly dividends. It’s over 50 years, dating back to before they were public. They have increased the dividend for 95 consecutive quarters. It’s an incredible record. Since they started, they’ve grown from a single Taco Bell, which was their first property. They had a Taco Bell.
Chokkavelu: Now they own a Chipotle place.
Frankel: I think Taco Bell is actually still one of their tenants. For a value-for-dividend investor, someone who puts income first, it doesn’t get better than this. I mean, these are great dividends and phenomenal returns.
Chokkavelu: I think you missed your calling, I know you lived in Key West and you should be selling real estate in Florida like you are pushing these real estate actions.
Frankel: I guess I should.
Chokkavelu: It’s compelling, especially with their monthly dividend, to be able to say, you used to quarters, so you’re like, wait over 600 straight months and you forget it’s months, not quarters but still.
Frankel: It’s still impressive.
Chokkavelu: Was it still 50 years old?
Frankel: About 51 years old. 1969, I think, is when they were founded.
Anand Chokkavelu, CFA has no position in the mentioned stocks. Brian Withers has no position in the stocks mentioned. Matthew Frankel, CFP owns shares of Realty Income. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.