The 7 Best REITs To Buy Now: October 2023
REITs are an exciting sector for investors. They offer exposure to the real estate market with little capital to purchase real estate properties. REITs are Real Estate Investment Trusts and investment vehicles, typically Equity REITs or Mortgage REITs.
Equity REITs are usually the more common type of company. They acquire and manage properties and receive revenue from tenants’ payments. Mortgage REITs focus on mortgage origination and gain revenue from interest payments from their customers.
REITs also offer excellent dividend yields because to qualify as a REIT, the company must give at least 90% of their taxable income back to investors, typically in the form of dividend payments; this is why REITs are an industry that offers greater dividend payouts compared to other market sectors.
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Below, I discuss seven different REITs that offer investors a great opportunity to grow their portfolio in the real estate market and have a positive future outlook.
VICI Properties (VICI)
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Vici Properties (NYSE:VICI) It is a company that owns various gaming properties, most notably many within the Las Vegas Strip, such as the MGM Grand, Caesars Palace Las Vegas, and the Venetian Resort Las Vegas, among others located throughout the U.S. and Canada.
VICI Properties is a strong company due to solid financials, and it owns some of the most coveted real estate in Las Vegas. It has continued to be stable throughout this higher interest rate environment.
The second quarter of 2023 represented strong earnings for VICI; its total revenue grew by 36% compared to the year before. It experienced a net loss of $58 million in Q2 2022; in Q2 2023, its net income was $701 million.
During the quarter, VICI Properties acquired four properties in Canada from Century Casinos (NASDAQ:CNTY), a casino entertainment company, and expanded their partnership with Canyon Ranch, which operates spas and resorts throughout the U.S.
It carries a decent dividend of 5.67% annually, paid out quarterly. They recently increased their dividend payment to $0.42, payable on October 5, 2023. And VICI plans to release its third-quarter earnings result on October 25, 2023.
Realty Income (O)
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Realty Income (NYSE:O) It invests in various retail real estate properties throughout the U.S. and Europe. Some of their owned properties include chain retail locations like Dollar General (NYSE:DG), Walgreens (NASDAQ:WBA), 7-Eleven (OTCMKTS:SVNDY), and Tesco (OTCMKTS:TSCDY).
It is one of a few different stocks that offer monthly dividend payments. It is also included in the S&P 500 Dividend Aristocrats Index, which comprises companies that have increased their dividend for at least 25 years. On October 10, Realty Income announced its dividend of $0.26 per share for November. Overall, their annual dividend yield is 6.03%.
The company’s share price has slumped by 15% within the past year. This is partly due to other REITs in their situation revolving around high interest rates. But, with solid financial results and a good track record, it offers investors an excellent opportunity to purchase shares at a discount.
Within their latest earnings report, Realty Income stated a 28% jump in overall revenue and a 12% decrease in net income compared to the year before.
Rithm Capital (RITM)
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Rithm Capital (NYSE:RITM) It’s a mortgage REIT that invests in properties in the United States and Europe. Their portfolio includes mortgage-related assets and various rental loan services.
It has an annual dividend payout of 10.59%, making it one of the higher-paying REITs. Mortgage REITs tend to do better than REITs focused on investments in properties in high-interest rate environments because mortgage REITs earn revenue from interest payments.
Over the past year, Rithm Capital’s stock price has grown by approximately 19%. And recently, on October 12, it acquired Sculptor Capital Management (NYSE:SKU), an assets management company, for $12 per share through an amended agreement.
Its second-quarter earnings report stated an increase in revenue of 33% and net income that more than quadrupled compared to the year before, partly due to an increase in overall interest payments. Their earnings date for the third quarter of 2023 is expected to be October 26.
Innovative Industrial Properties (IIPR)
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Innovative Industrial Properties (NYSE:IIPR) It is an industrial REIT that leases properties exclusively to operators in the licensed cannabis industry.
It is one of the only REITs trading publicly that provides real estate for the cannabis industry. This puts it at a considerable advantage if cannabis legalization continues throughout the U.S. However, in 2022, the company was hit relatively hard by issues regarding cannabis legalization and tenants defaulting on rent payments.
The company is trading at a great value and has an extraordinary dividend of 9.15% annually, paid quarterly, with its last dividend payment being $1.80.
IIPR has been experiencing much better rent collection rates recently and within an industry that could see improved legislation. IIPR is positioned very well to take advantage and continue to grow.
CareTrust REIT (CTRE)
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CareTrust REIT (NYSE:CTRE) is a healthcare REIT that owns various nursing and senior care facilities throughout the United States.
Since last October, CareTrust has seen its share price grow by approximately 26%. On August 3, CareTrust released its earnings results for Q2 2023, which stated an increase in total revenue of 8% compared to the year before. They also reported a net loss of $0.5 million. Within the second quarter, they acquired 12 different properties altogether. The cost was $174 million.
CareTrust has an annual dividend yield of 5.08%. Their last quarterly dividend was $0.28 per share.
Essential Properties Realty Trust (EPRT)
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Essential Properties Realty Trust (NYSE:EPRT) Its acquired properties are leased typically to single tenants, and they have a portfolio of over 1,700 properties primarily within the service industry, such as car washes, education centers, medical facilities, movie theaters, and grocery stores.
Its last earnings report stated a 21% increase in total revenue, and net income rose by 48% compared to the previous year. And they also invested nearly $300 million in 78 different properties this quarter.
In September, EPRT announced they would add 8.7 million shares of common stock in a public offering. This is because they wish to raise capital for a previous sales agreement.
EPRT expects to release third-quarter earnings on October 25.
Kite Realty Group (KRG)
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Kite Realty Group (NYSE:KRG) Is a retail REIT that owns many open-air shopping centers in 24 other states.
Over the past year, Kite Realty Group has seen a 12% jump in its share price. Investors are interested in the company’s growth potential due to their positive financial performance and high occupancy rates among tenants.
They released their second-quarter earnings results for 2023 on July 31. It started an increase in revenue of 3%, and net income more than doubled. In September, Kite Realty Group announced that S&P Ratings upgraded the company’s outlook from stable to positive
As of this writing, Noah Bolton held a LONG position in RITM. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Noah has about a year of freelance writing experience. He’s worked with Investopedia dealing with
topics such as the stock market and financial news.
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