Realty Income: America’s Best REIT On Sale For High-Yield And High Return | FAST Graphs
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- Опубліковано 27 тра 2024
- In this video, Chuck Carnevale, Co-Founder of FAST Graphs, a.k.a. Mr. Valuation will discuss the current investment opportunity in Realty Income (O), a popular real estate investment trust (REIT). He will explain the importance of buying low and selling high in investing and highlight why now is a great time to consider investing in Realty Income. Chuck will analyze key financial indicators such as funds from operations (FFO) and free cash flow to equity to determine the valuation of the stock. He will also address concerns about rising interest rates and provide insights from analysts' forecasts. Don't miss out on this chance to potentially earn a high dividend yield and capitalize on the growth of Realty Income.
Time Codes:
0:00 - Realty Income (o)
9:49 - Spirit Realty Capital (SRC)
14:12 - Final Remarks by Chuck Carnevale
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Disclaimer: FAST Graphs is a tool designed to reveal and present information related to financial data and investment metrics. It is not intended to provide specific advice or recommendations. Instead, it offers a comprehensive view of relevant data, empowering users to make informed decisions based on their own analysis. It's your first step to a more comprehensive research and due diligence process. In short, it is a tool to think with. The opinions in this video are for informational and educational purposes only and should not be construed as a recommendation to buy or sell the stocks mentioned.
#dividends #reits #investing - Навчання та стиль
Sometimes buying at lower prices can be hard bc you’re worried it could keep falling.
1. Don’t put all in at once, put in 1/4 or 1/2 of goal position size and look for opportunities
2. Even if it falls lower that’s ok as long as you’re comfortable with where you bought in
Thanks Chuck I have been adding O
Easy to say, harder to do. I was comfortable before they decided to do aquisition which will add only 2% to FFO. Dont forget that 80-90% of aquisitions fail and they caused fail or distress of many companies. Secondy buying in more trenches sounds good but is not working in practise. That way you will have full portfolio of 1/4 positions of winners where it rallied after your purchase and full positions in losers which keep going down (for a reason).
WRONG
@@val_inv6239 WRONG
I OWN 2500 SHARES OF REALITY INCOME AND I BUY SHARES TWICE A MONTH, AND WILL CONTINUE MY BUYING FOR THE NEXT 3 TO 4 YEARS. I ALSO REINVEST. Os DIVIDEND TO BUY MORE SHARES. 💰 🤑 💸 👍👍
Thanks Chuck. I agree it was a great time for O to go shopping for smaller Reits. Fast Graphs is a fantastic tool. It helps show a company's fundamentals in a way that is easier for me to grasp. That's for that also.
Prices have gone up: restaurants, car washes, home improvement and Realty Income will be raising rent over the next decade. Buy now and participate in the growth.
Where'd you get your crystal ball?
Have been waiting for O to be on sale for a long time. Finally here . Thanks Chuck
／
Glad to see this video. Just bought ten more shares in after hours. Soon my position is 200 shares. My biggest position ever. Long hold and long live O 📈💎🙏🏻💯💯
O has a 1 year return of -26%, a 5 year return of -22% and a 10 year return of 19%.
Did you even perform a basic check on the history of O?
@@iamtoothewalruswill you write this under every post now?
@@iamtoothewalrus I have monitored and owned the company now about four years thanks for asking.
Thanks for another instructive video.
Agree Really (ADC) is another solid REIT on sale.
Getting close but not yet there in my humble opinion, but close
Thank you Uncle Chuck. Please review $PII when you have time. It’s come down so much recently
Thanks for the timely video, Chuck!
Bought 10 shares this morning and this evening watching Chuck talk about it...
is it still on sale?
@@waynv1835 imo yes.
@@waynv1835Yes, but i believe Agree realty(adc) is the better value.
Got in a few weeks ago around $50. Let it sit and grow. 😉
Thank you Chuck. Great suggestion, as usual. Could you make a videi of MMM? The current situation is very interesting. Have a nice evening!
Yes please!
and VFC
Great Job Chuck, thx for the very timely video
excellent video chuck , I loaded the O train today , thank you.
Thanks Chuck! Very useful information. Would you mind doing one on WPC?
Another Great stock, another Great video! Thanks Professor
Another epic lead from the goat 🐐 dividend investing 🔥🙏🙌🏾👊🏽💪🏾🇺🇸👏🏿💵 don’t doubt chuck !! This is a quality company!!
Chuck is THE Master Instructor !
Chuck, I have learned over the years to appreciate and respect your advice and will seriously consider adding O to my portfolio.
Great evaluation on O can you please do AMT and DLR also? Thanks
Been averaging into O and NEE recently. Thanks for the analysis.
same here! Looking at NEE for yrs on and off, always seemed way overvalued- finally came into FV so I got sum.
Great call, Mr. Valuation ! Thanks from 111k subs ÷ those that acted on it .
Great video, Chunk!!
If we buy after hours will we get the dividend? The ex day js tomorrow
Thanks Chuck, bought more today before your video!
Absolutely great video.
thanks sir! how about EXR?
does arb deal to buy SRC make sense ?
Could you do a video on SPGI? Had a nice pullback but still high PE ratio
You shouldn’t consider PE for REITS
@@Brayness SPGI is in financial sector and not REIT. It is similar to Moody
@@kurniawanms2 lol my bad, mis read that as SPG, Simon Property Group
the value of this company is really the leases. Not just the property itself. A LOT of retail investors do not understand how this company truly works, nor how they get their capital. They can most certainly be viewed as a bond like proxy
Thanks, very timely Chuck! I bought more today, plus caught the monthly div- sometimes you have to reach down and grab a handful of courage, buy quality when it's out of favor. I think Uncle Warren would approve
Uncle Warren stays away from REITs. But Charlie Munger buys real estate directly.
@@val_inv6239 Uncle Warren prob doesn't need increasing monthly dividends
Thanks Chuck, another great video
I took advantage as well my friend and increased my position size 👍
Thank you Chuck!!!
Literally spent £600 on realty yesterday b4 this vid 😂
Nice one chuck 👍👍
Thank you. I always appreciate you.
👍 great video
O has performed well in the past, presumably due to ZIRP. How will it perform in the future if rates remain higher for longer? Dividend growth has slowed but the payout seems to be well covered, so over 6% dividend yield and 4% growth could give investors 10% return from here on.
Realty income has operated profitably and raised their dividends through several interest-rate cycles since 1969. They are a dividend aristocrat and a dividend Champion that has increased their dividend for 30 consecutive years. I think many investors put way too much emphasis on interest rates. Regards, Chuck
Thank you for your content; I recently found your channel and have really enjoyed your videos. Can you please add some context why you feel 15x P/AFFO is ideal versus say 10x or 20x? How did you arrive at that multiple, and do you assess its reasonableness with some frequency? Thank you!
Let me start by stating that a 15 multiple is offered as a fair value reference line on FAST Graphs. This should be thought of as a barometer of sorts. With that said, the proof is in the pudding and by viewing any long-term FG you can analyze whether that valuation reference is useful towards making better buy, sell or hold decisions. With that said, the important thing about a 15 multiple is the inverse, referred to as E/P which represents an earnings yield. A 15 PE represents an earnings yield of 6.67% which is the midrange of the average return that stocks have generated over 200 years. Of course sometimes higher sometimes lower. But the main point is to use the valuation reference lines both the orange and blue on our graphs to help you decide on proper entry or exit points. Here is some additional information: fastgraphs.com/blog/why-a-15-p-e-ratio-is-fair-value-for-most-companies/ welcome to the channel, Chuck
Agreed I bought some today.
Thanks chuck
I just bought 58 more shares and will cont. To buy every month
I got at $60 = (
i feel better hearing this.
Great chuck
Nice video Chunk!
Thanks for this video
Thanks for bringing another winner to our attention, to add to our portfolio Chuck, as always you highlight the best while there on sale. Have been watching this one for a while & thanks to you it's time to pull the trigger.
Winner???
O has a 1 year return of -26%, a 5 year return of -22% and a 10 year return of 19%.
I guess you haven't used the fastgraphs software much or listen to Chucks video's. It all comes in cycles the sectors all move together at times. Just like this one, all the Reits seem to be down at the same time as the interest rates or on the high end at the present.
@@iamtoothewalrus do you not understand that it was overvaluation that causes those poor returns.
@@iamtoothewalrus did you buy exactly one year or 5 years ago, or two days ago? That's a big difference
I guess Chuck did this right on time at the news today that Realty income decides to acquire Spirit realty?
all-in!
Great Video! Thx a lot, Chuck! ❤
awesome video, as always.
What about MDT (Medtronic), historically cheap!
I started a small position in MDT recently
Have you ever analyzed RC Realty Capitol?
As a Canadian I love this stock as I use it for a currency hedge in my retirement savings (foreign dividends are not taxed). I see it as a long time buy and hold.
I have a sizeable position at $47. Couldn’t be happier ❤🎉
My average price is $60 for O and I'm on the red now. Should I continue investing now at $55?
Let's go!
Hey Chuck you should do an update on SWKS. Please and thank you
Yes.
I am buying up this December
I think it is going to go much lower... I'd wait.
I have a cost basis of 42.20 for O so I Am struggling on whether I should buy it now which will increase my cost basis which is a rule I try to never break (buying above my basis) But O is my largest and favorite REIT holding so I just may break my own rule.. Thanks Chuck
This rule is really limiting and not good. You should think about changing it. :) I would rather have a lot of good stocks that cost 50 dollars in average, instead of just a small amount at 45 dollars. In the long run, if you invest for a long time, this difference (in price) won't matter at all.
Yes. Maybe nibble. If goes done more nibble some more.
Wish I had a 42$ cost basis, lol. I'm at 57 and dca down currently.
@@Metal_Stacking
I’m at 58 but was much higher until recently. O was well above my average for a long time and as it’s fallen below I’ve been buying more and more. At this price you can DCA down quickly.
It's not the price that matters it is the valuation that matters most
added with 200 for 45 :)
Man. It’s currently trading at $56. Wish I would have snagged it at $46
Great video.,....O or EPR right now?
go with O, much more diversified
They are both undervalued but O is a stronger and more consistent company
Added more today. Room to add if she goes lower.
Good video! Can you do a video like this on ADC the little brother of Realty Income please? Thanks
I’m locked in at 48.34
Hello Chuck!!! Would you mind to do a review of VFC.
Notice at 7:55 the Yahoo screen says O is overvalued??
Yahoo like many other financial sites measure REITs utilizing earnings instead of FFO or AFFO as they should. Remember REITs have a special structure unlike regular corporations. Regards, Chuck
Isn’t O going to issue stock to purchase diluting shareholders?
@@sociolocomtsacO wouldnt be aqcuiring businesses in the current market if the risk - reward wasn't good.
Do not buy reits if you do not like share dilution.
Better stock dilution than taking more debt with high interest rate now. REIT is legally required to distribute 90% of their earnings to shareholders. How do you think they can grow? Hint: share dilution or issuing more debts
Today IB brokers says that O dividend payout ratio is 232.42% is that a red flag?
That figure is based on earnings. REITs are not evaluated based on earnings but on FFO (funds from operations). Plus they are required by law to pay out 90% of the distributable income. The current payout ratio is in compliance and normal
Great, realty income was also said to be on sale 15% higher. This reminds me of how I made my first & second million, I invested an aggressive lump sum in trading stocks with the help of an excellent finance manager who trades for me.
It is, who's your fm & how can I reach this person to aid me trade my funds too?
👍👍. My finance manger is Erlinia Jedraa Barrett, she helps me trade my funds. I met her at a finance seminar in NY. Research her.
it was then and is now
@@FASTgraphsthese comments are typically scams by the way. Just so you know not to interact with them.
Here’s where Im completely clueless Chuck - even after todays spike in share price, SRC’s market cap is under $5B. Why is Realty paying over $9B for it? I must be missing something obvious
Yes, debt
Total enterprise value of SRC is $8.326 billion after yesterday's rise
Dilution?
I really want to buy but the growth is too slow
The valuation compensates for that plus the dividend
Is O a qualified dividend?
Ordinary, best in a Roth
Recently started a position
🎉🎉🎉
P/E way above the holly grail of 15 P/E?
You don't evaluate REITs with earnings you evaluate them with FFO or AFFO. The multiple of FFO is 13.8 well below 15.
I like ADC way more then O,same Buisness
ADC is a solid REIT but it does not offer the margin of safety or the dividend yield that Realty income does. Regards, Chuck
Both are great my favorite two
Size matters during bad times. O market cap is $33.6B ADC market cap is $5.6B. O also has more properties it can sell if we have deep recession. O also has $2.7 billions cash flow. ADC has $395 million cash flow. Who do you think can weather the recession better?
What About Agree Realty?
Fairly priced, however, the growth expectations for the next few years are very low
@@FASTgraphs TnX. I wonder if they are able to grow their dividend?
You didn't talk about the dilution
This is a common practice for REITs as they use the money to buy more real estate and generate more cash flow which is how they have increased their dividend every year for 30 years.
Realty income was also said to be on sale 15% higher.
It was.
Good news: It's still on sale.
yowza!
Why is it on sale? Is the market wrong again?
Yes
Yep I’m buying 500 dollars worth every paycheck for now
Yes. I’m a Realtor for Investors.
There is a difference between the market value (stock market) versus financial strength of a company.
Thanks for this video.
The price for Reits rissen with Low interest Rates, but now With Higher yields for longer it is Not so easy to make Money as in the past.
With current valuation so low it is the opposite, it is easier to make money now than in the past. Valuation matters and it matters a lot.
O long
It's an all-stock transaction ($9b+) and therefore a dilution of O shares. You get SRC at the cost of O equity. That's why the stock has fallen. Sit tight; it will fall further.
Better stock dilution than taking more debt with higher interest rate now. It will definitely fall further but I Cannot time the market. Just DCA. This will not be a falling knife
Interested in buying STAG, now O buys industrial stuff. hmmmm
Yes, I agree with you.
5x avg.daily volume......
Ergo the opportunity has arisen
Realty Income is at valuation it had at the bottom of 2009 recession. The worse recession in 80 years. Something fishy is going on with the market as SPY is at 5Y average valuation aka very high but part of the market is priced as we are in the worst recession in a century. My only worry is what will happen to Realty Income and similar stocks when SPY will fall 20-50% in a recession in 2024. Will O add antoher 50% down too? I guess it is possible.
Excess money was printed to inflate the big 7 and numerous people fled from small caps into these rockets
You should worry more for big tech stocks with very high P/E valuation. Those stocks will be punished more when the recession hits. Just look at AAPL. You are paying for 29 times earning expecting high growth but AAPL revenue has been declining for 3 straight quarters (let's see what happens this Thursday) but the P/E is still at 29! Lots of REIT stocks like O have already been punished severely. The market is forward looking. Lots of bad news are already baked in. They can still drop lower when recession hits but look at the risk / reward ratio. At this price, there is more upside than downside for O.
Thats theory. in practice discounted stocks fall even harded that the overpriced. Look at UGI, MPW etc. When UGI entered downturn in utilities the stock was already discounted but it didnt stop it to crash much more than overpriced NEE. Quality even when overpriced had hold much better. For example ADP going into 2009 and 2020 market crash.@@kurniawanms2
@@val_inv6239 UGI hit the dirt because NG and propane prices hit the dirt
when they go low I will go buy (a twist to Michelle Obama's phrase "when they go low I will go high")
Not sure how O makes money but housing future looks awful
gee you need to research more
@@land7776 fair enough but I’m not getting in to real-estate now no way..
@@jdedad ok, good luck finding a sector or co that's undervalued with best yield when everything seems hunky-dory
@@land7776 air is cheap I’m not buying that either. Just because something on sale is not a reason to buy it especially if it’s has a lot further to go down
@@jdedad no, I wouldn't buy air or anything just because it's on sale either. A great co that's well undervalued is a different thing. I wonder how you know it's got a lot further to go down though-
Heute 6 % abwärts, was ist denn da los ?
Die angekündigte Übernahme von Spirit Realty über 9.3 Mrd kam nicht gut an
@@doktorbrowning1327 it is very common to see a company announce an acquisition and see the price drop temporarily
@@doktorbrowning1327listen & kaufen 😉
The adjusted operating earnings chart still looks like O is over-bought or over valued. I am waiting because the 1 year chart still looks like a falling knife. I think Chuck may be discounting the negative effect of long-term interest rates staying elevated, a little too much.
REITs are special asset class and you do not value them based on earnings of any kind. Funds from operations and/or adjusted funds from operations are the metrics to evaluate REITs with. Regarding interest rates, they are the gift that created the low valuation opportunity. In my humble opinion you are giving more impetus or credit to interest rates than is warranted. Realty income has raised their dividend for 30 consecutive years in all different interest rate levels.
Thanks for that info update.@@FASTgraphs
@FASTgraphs Dear Chuck, I would like to ask you, how do you think of O now? Why has it been falling recently?
Yea but we didn't have alot of empty office space because of people working at home right right
Realty income is not an office REIT it is a retail REIT
@@FASTgraphs retail you mean like shopping malls or what because there alot of empty space because of Jeff beers Amazon sucking up all those profits
@@rogerfleck5387 www.realtyincome.com/our-portfolio/portfolio-diversification-overview
@@rogerfleck5387 Retails like BJ Wholesale, Walmart, Sam's Club, Red Lobster, Home Depot, CVS, Lowe's, LA Fitness, Fedex, 7 Eleven. Do you buy all your grocery, home appliances & furniture, medicine from Amazon? Do you go to Amazon gym as well?
Never by shares on line. Crooks.
The 5 year return on Realty Income is -22%. This is not a typo, Realty Income lost 22% in the past 5 years.
Simply buying the NASDAQ returned a positive 80% in the past 5 years.
Why in the world would you put your money in "money losing" companies when you can simply buy an index which crushes companies like Realty Income?
Last time the nsadq was in a bubble, it took 17 years to break even. 2000-2016
Imo it is definitely in a popping bubble buy today. You could be down for another 16 years.
If you watch the video closely and understand that Realty income was significantly overvalued for the past 5 years and you and understand why what you said is true. You don't buy high and expect to make money, you buy low. Watch the video again and focus on how the price is so significantly above the orange fair value line on the FAST Graph. As I often state measuring performance without simultaneously measuring valuation is a job half done. My point being that it's important to know why it underperformed and more importantly why it's different now. Regards, Chuck
@@Metal_Stacking you need to watch the video and pay attention to what is being shown. The stock was in a bubble several years ago if you want to call it that but not now.
@@FASTgraphs chuck was referring to the nasdaq not O
O is too big, plain and simple. Calculate 5% FFO growth for the next 10 years, we're all long time investors here right?, and you'll see they just can't sustain this type of growth. Take NNN on the other hand, plenty of room for growth. Not saying NNN is better, simply using it as an example that's closet to O that is not limited from growth due to their size. 40B market cap vs. 6.5B. Long story short, O is getting too big for its own good and future growth will not be anything like historical growth, hence not a good metric to predict future returns.
Future growth is not predicated on historical growth. Ergo the acquisition they just announced.
I'm adding Nnn to my watch list. I also like montly dividends opposed to quarterly
Correct. Its massive size will hamper its future growth But its bigger size also helps to cushion the blow from the recession (if it happens next year). IF we have a deep recession. O can sell out some of the properties to get more cash to last till the recession ends. O also has $2.7 billion FCF . NNN has $600 millions FCF. Size matters during bad times. O will weather the recession better than NNN. I buy O for its dividend reliability. If I want growth, I buy tech stocks like AMZN, GOOGL, META instead of NNN. I actually have O, GOOGL and META now