Morningstar Rating
Stock XNYS Rating as of
$52.82 +0.39(0.74%)
View Full ChartAs of Delayed Price Closed
Unlock our analysis with Morningstar Investor
Company Report
Company Report
Most REITs in the US Are Trading at Significant Discounts to Fair Value
Kevin Brown
The US REIT sector remains significantly undervalued, in our perspective. While the pandemic hurt REIT valuations in 2020, the recovery of fundamentals across most sectors combined with low interest rates led to strong total returns in 2021 and early 2022. However, despite fundamentals continuing to perform well over the past two years, with many REITs reaching historical levels of net operating income growth, the sector has underperformed the broader equity markets over the past two years. We believe that the cause has been the sector’s negative correlation with interest rates as income-oriented investors rotate out of the sector, higher rates lower the value REITs can create with external growth, and property valuations fall in line with higher rates. However, we don’t believe that higher rates significantly change our fair value estimates for the sector. Additionally, interest rates are down from the October 2023 highs, and REIT share prices have generally inversely followed the movements of the US 10-year Treasury.
O is trading at a 165% premium.
Price
$52.82
Fair Value
$59.00
Uncertainty
Low
- 1-Star Price
- $91.00
- 5-Star Price
- $12.20
- Economic Moat
- Mqdks
- Capital Allocation
- Hvyzzwmm
Bulls Say, Bears Say
Bulls Say, Bears Say
Bulls
Realty Income provides a reliable, albeit slow-growing, monthly dividend built on a steadily performing underlying portfolio through various market conditions.
Bears
It will take an increasingly greater volume of attractive risk-adjusted acquisitions to create meaningful shareholder value growth, possibly pushing Realty Income to take more risk as competition expands for its traditionally targeted assets.
Is it the right time to buy, sell, or hold?
Start a free trial of Morningstar Investor to unlock exclusive ratings and continuous analyst coverage to help you decide if O is a good fit for your portfolio.
News
News
- Realty Income Announces Second Quarter 2024 Earnings Release Date
- 126th Common Stock Monthly Dividend Increase Declared by Realty Income
- Realty Income Raises 2024 Earnings and Investment Guidance
- Realty Income Announces Common Stock Dividend Increase of 2.1% and Declares Preferred Stock Quarterly Dividend
- 646th Consecutive Common Stock Monthly Dividend Declared by Realty Income
- REALTY INCOME ANNOUNCES FIRST QUARTER 2024 EARNINGS RELEASE DATE
- Spirit Realty's stock rallies on $9 billion buyout by Realty Income Corp.
- Blackstone sells Bellagio stake to Realty Income Corp. in post-COVID rebound
Trading Information
Trading Information
- Previous Close Price
- $52.43
- Day Range
$52.13–52.86
- 52-Week Range
$45.04–64.18
- Bid/Ask
- $52.65/$52.72
- Market Cap
- $45.99 Bil
- Volume/Avg
- 8.4 Mil/5.6 Mil
Key Statistics
Key Statistics
- Price/Earnings (Normalized)
- 38.38
- Price/Sales
- 8.85
- Dividend Yield (Trailing)
- 5.83%
- Dividend Yield (Forward)
- 5.98%
- Total Yield
- 5.83%
Company Profile
Company Profile
Realty Income owns roughly 13,400 properties, most of which are freestanding, single-tenant, triple-net-leased retail properties. Its properties are located in 49 states and Puerto Rico and are leased to 250 tenants from 47 industries. Recent acquisitions have added industrial, gaming, office, manufacturing, and distribution properties, which make up roughly 17% of revenue.
- Sector
- Real Estate
- Industry
- REIT - Retail
- Stock Style Box
- Mid Core
- Total Number of Employees
- 418
- Website
- https://www.realtyincome.com
Competitors
Competitors
- Regency Centers Corp REG
- Kimco Realty Corp KIM
- Federal Realty Investment Trust FRT
Valuation
Valuation
| Metric | O | REG | KIM |
|---|---|---|---|
Price/Earnings (Normalized) | 38.38 | 30.82 | 41.07 |
Price/Book Value | 1.18 | 1.69 | 1.24 |
Price/Sales | 8.85 | 8.17 | 6.66 |
Price/Cash Flow | 13.33 | 14.70 | 14.33 |
Price/Earnings
O
REG
KIM
Financial Strength
Financial Strength
| Metric | O | REG | KIM |
|---|---|---|---|
Quick Ratio | 1.49 | 1.24 | 1.80 |
Current Ratio | 1.55 | 1.35 | 1.82 |
Interest Coverage | 1.96 | 3.32 | 2.47 |
Quick Ratio
O
REG
KIM
Profitability
Profitability
| Metric | O | REG | KIM |
|---|---|---|---|
Return on Assets (Normalized) | 1.94% | 3.36% | 2.26% |
Return on Equity (Normalized) | 3.39% | 6.10% | 4.23% |
Return on Invested Capital (Normalized) | 3.39% | 4.59% | 3.48% |
Return on Assets
O
REG
KIM
See how this stock stacks up to its competitors with Morningstar Investor
REIT - Retail Industry Comparables
REIT - Retail Industry Comparables
| 1-Day Chart | Name | Price | Morningstar Rating for Stocks | Capital Allocation | Economic Moat | Market Cap |
|---|---|---|---|---|---|---|
| Simon Property Group Inc SPG | Xjzvfdpdy | Fjt | $49.5 Bil | |||
| Kimco Realty Corp KIM | Bxnkgyjzb | Fyt | $13.1 Bil | |||
| Regency Centers Corp REG | Xjfzvhhh | Xxtd | $11.5 Bil | |||
| Unibail-Rodamco-Westfield Act. SIIC ET STES FONC.EUROP. UNBLF | — | Drww | $11.0 Bil | |||
| Scentre Group STGPF | — | Ctld | $10.8 Bil | |||
| Link Real Estate Investment Trust LKREF | — | Cyn | $9.9 Bil | |||
| CapitaLand Integrated Commercial Trust CPAMF | — | Hjsmmp | $9.8 Bil | |||
| Federal Realty Investment Trust FRT | Rgpxccxj | Nrc | $8.4 Bil | |||
| Macerich Co MAC | Bhnzpbss | Lrz | $3.3 Bil |
