Net Lease REITs

I’ve finished downloading and updating the top 3 Net lease REITs, NNN, O and WPC

My sense is any of these is a worthy buy for those looking for long term reliable dividends, at a current yield of 4.9%, 4.4% and 5.3%.

The good news is none of these cut their dividends following the Covid-19 recession nor during the credit crisis of 2008-09, although growth slowed to a crawl over these periods…and this is good.

The not so good news is dividend growth has again slowed for all, with this slowing beginning in 2018/19 before Covid-19.

Dividend coverage by net CFFO is trending favorably for NNN and WPC but not so much for O. Interest expense as a % of operational cash is also trending positive (the interest expense % is declining) for all 3. And the Revenue and Net CFFO per share is also trending positive for all 3 coming out of 2020, particularly NNN.

From these cash flow trends, I’d suspect we’ll see annual dividend growth return to the 3% to 4% range over the rest of 2022 and thereafter.



Thanks, Bruce, for your take on these three REITs.

I own all three.

(Formerly TMFWysocki)