Dividends4Life: 2 REITs With Attractive Yields and Growing Payouts

2 REITs With Attractive Yields and Growing Payouts

Posted by D4L | Thursday, September 15, 2016 | | 0 comments »

In a world where you need to hold a U.S. Treasury for 10 years to get a measly 1.5%, real estate investment trusts (REITs) have become an incredibly attractive income-yielding alternative. So attractive, in fact, that the SPDR Dow Jones REIT ETF (RWR) has soared over 12% in the last year. That also means the ETF’s dividend yield has fallen, and it now pays less than 4%. On top of that, RWR’s dividend is uneven because of the complexity of its constituents’ payouts, making this income stream an unreliable one. Dividends were $1.03 in March and 78 cents in June, and the dividend usually bounces around from quarter to quarter.

Simon Property Group Inc (SPG), which has an impressive 154% dividend coverage ratio even after recently hiking its dividend by 5 cents. The REIT is also up 11.6% over the past year. Simon Property Group specializes in shopping malls, and has expanded to have a global footprint in U.S., Europe, and Asia. Recently the company expanded into Seoul, Canada, Silicon Valley, and Ohio. Sabra Health Care REIT Inc (SBRA), which yields over 6% and still remains down over the past year. With an aging American population, companies like Sabra will see strong and growing demand for their properties. Indeed, revenues have increased 30% in the last year, and that growth rate shows no signs of slowing down.

Source: InvestorPlace

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