Bad News For The Market, Good News For Income Investors
The market has become an uncertain place. Neither equities nor bonds offer safety. Such times create opportunities.
REITs: The Riches Are In The Niches
REITs offer diversified, inflation-hedged income and capital appreciation, making them a compelling addition to any long-term investment portfolio. Current REIT valuations are attractive, with strong growth projected in sectors like data centers, industrial, net lease, and residential properties. I recommend focusing on quality REITs trading below historical multiples, emphasizing margin of safety and reliable dividend growth.
Agree Realty Preferred - Its Yield Is Starting To Make Sense
Agree Realty Corporation 4.250% DEP PFD A possesses a current yield of 6%+, a 200 basis point premium to Agree Realty's common shares. The REIT's growth outlook remains strong given the myriad of macro and credit-level challenges faced. Moreover, Agree Realty's leverage is relatively low and higher gearing remains a possibility. ADC.PR.A might not share in its fundamental growth factors, but its discount likely presents upside in itself, while fundamentals contribute to lower counterparty risk.
If I Could Only Buy 2 High-Yield REITs Today
REITs have been in the penalty box for nearly 3.5 years now. This has opened up some highly compelling opportunities in the sector. I share my top 2 high-yield REIT picks right now.
REIT Roulette: Why I'm Overweight Net Lease
Diversification is key in REIT investing, mirroring my roulette strategy—spread bets across sectors for optimal risk-adjusted returns. Net lease REITs offer stability and steady dividends, outperforming residential mREITs over 15 years and thriving even in volatile environments. Current market trends and strong earnings support overweighting net lease REITs, with sector consolidation and potential rate cuts as additional tailwinds.
Tariffs Up, Inflation Down
US equity markets surged this week - extending a dramatic post "Liberation Day" rebound - after the White House announced a trade truce with China, while investors cheered surprisingly cool inflation data. Quelling one of the primary recession risks, the U.S. and China reached a surprising breakthrough in agreeing to slash tariffs to pre-retaliation levels during a 90-day negotiating period. More good news on the inflation front. Despite the broad-based tariff hikes in April, the critical CPI and the PPI both showed the lowest annual increase in inflation since 2021.
The REIT Way To SWAN With These 5 Monthly Dividend Payers
I highlight five SWAN (Sleep Well At Night) REITs that pay monthly dividends and offer strong balance sheets, attractive yields, and growth potential. Realty Income, Healthpeak, Agree Realty, LTC Properties, and STAG Industrial are my top picks, each with well-covered dividends and favorable valuations. I caution against Gladstone Land due to its unsustainable payout ratio and negative earnings trend, labeling its yield a potential 'sucker yield.'
Buy The Dip: 2 Blue-Chip High Yields Getting Way Too Cheap
I focus on buying high-quality, high-yielding dividend growth stocks. When they go on sale, I pounce. I share two that are trading at highly compelling opportunities after recent pullbacks.
Ideaya Biosciences: Value Beyond Darovasertib With ADC Program IDE849
Ideaya Biosciences, Inc. is advancing darovasertib in a phase 2/3 trial for HLA-A2-negative metastatic uveal melanoma patients, with mPFS data expected by end of 2025. Ideaya plans a phase 3 study of darovasertib as a neoadjuvant for uveal melanoma, starting in the first half of 2025. IDE849 is an ADC targeting DLL3 in SCLC and NETs, This program has two catalysts: phase 1 data in Q3 2025 and a new study in H2 2025.
Agree Realty: Premium Valuation, But Still Worth Considering
Agree Realty has outperformed peers and the S&P 500 since our last update, driven by a strong dividend yield and share price recovery. Even with the greater volatility that the broader market has been experiencing, ADC has remained resilient, but has moved to a premium valuation against peers. Despite a premium valuation, ADC's focus on quality tenants, steady AFFO growth, and strong balance sheet can justify it still being a worthwhile investment.
A Ranking Of Net-Lease REITs By Investment Spread For Q1 2025
In Q1 2025, VICI, GLPI, Agree, and Realty Income generated positive investment spreads and total returns exceeding their cost of equity, making them attractive investments. EPRT and STAG have negative investment spreads and total returns below their cost of equity, making them less favorable investment options. This analysis uses cap rates and the weighted average cost of capital to estimate investment spreads. We also compare total returns to the cost of equity to measure accretion.
Agree Realty: Outperforming Net Lease (Rating Downgrade)
Economic uncertainty and volatility in 2025 present long-term investment opportunities, especially in high-quality commercial real estate like ADC. ADC has a strong track record, with a compound annual return of over 12% since its 1994 IPO and consistent dividend growth. Despite ADC's impressive portfolio and balance sheet, current high valuations limit upside potential, making it prudent to hold rather than buy at $77 per share.
