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Realty Income Corp. (O) Outpaces Stock Market Gains: What You Should Know

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Realty Income Corp. (O) closed at $68.06 in the latest trading session, marking a +1.61% move from the prior day. This move outpaced the S&P 500's daily gain of 0.95%. At the same time, the Dow added 0.8%, and the tech-heavy Nasdaq lost 0.28%.

Prior to today's trading, shares of the real estate investment trust had gained 3.75% over the past month. This has outpaced the Finance sector's gain of 1.41% and the S&P 500's gain of 0.1% in that time.

Realty Income Corp. will be looking to display strength as it nears its next earnings release. On that day, Realty Income Corp. is projected to report earnings of $0.97 per share, which would represent year-over-year growth of 10.23%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $814.89 million, up 75.52% from the year-ago period.

O's full-year Zacks Consensus Estimates are calling for earnings of $3.91 per share and revenue of $3.29 billion. These results would represent year-over-year changes of +8.91% and +57.85%, respectively.

It is also important to note the recent changes to analyst estimates for Realty Income Corp.These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.17% lower within the past month. Realty Income Corp. is currently a Zacks Rank #3 (Hold).

In terms of valuation, Realty Income Corp. is currently trading at a Forward P/E ratio of 17.12. This represents a premium compared to its industry's average Forward P/E of 14.81.

We can also see that O currently has a PEG ratio of 4.84. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The REIT and Equity Trust - Retail industry currently had an average PEG ratio of 2.16 as of yesterday's close.

The REIT and Equity Trust - Retail industry is part of the Finance sector. This group has a Zacks Industry Rank of 103, putting it in the top 41% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow O in the coming trading sessions, be sure to utilize Zacks.com.


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