Unlike traditional stocks, REITs derive their intrinsic value (of the underlying business) more on the value of the income stream or dividends paid. Because Real Estate Investment Trusts (REITs) distribute (by law) at least 90 percent of their taxable income to shareholders annually in the form of dividends, investors are becoming increasingly attracted to the notion of balancing a portfolio with steady and reliable dividend income.
In the more literal sense, REITs have become fortresses (smart in Latin) for dividend investors. With the pending expiration of the Bush Tax Cuts at the end of this calendar year, REIT investor income and other taxable dividends will come into tax parity (assuming congress makes no further changes to these rules) and both revert to being taxed at ordinary income rates in 2013. If demand for tax preferred qualifying dividends were to shift partly over to REITs as this tax advantage is removed, that increased demand should be a tail wind for REIT share values.
Source: Forbes
Related Articles:
- 7 High Yielders With A Low Free Cash Flow Payout
- Wealth is a Journey, Dividend Stocks Can Take You There
- 5 Higher-Yielding, Income Growing Tech Stocks
- Warning Signs of an Imminent Dividend Cut
- 7 Higher-Yielding Consumer Stocks To Build Your Yield
REIT Dividends: A Beacon For The Fiscal Cliff
Posted by D4L | Thursday, January 03, 2013 | 1 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
As a relatively new blogger, the one thing that has stood out in my mind is the number of Canadian bloggers in the areas that I am most inte...
-
Investors wanting to enjoy steady and consistent income should consider dividend aristocrats. In fact, even in these chaotic times, dividend...
-
Dividends and diversification -- those two things can help you achieve a comfortable retirement when combined with the income you will recei...
-
A select group of monthly dividend stocks pays dividends at a rate of 10% or higher. Those are the ones on this list. Investors should be aw...
-
Higher dividend yields often imply that the underlying company paying the dividend has a higher risk profile. However, that's not always...
-
It's hard to beat a sustainable, high-yield dividend paired with a beaten-down valuation. The best dividend stocks offer high yields and...
-
How high is too high when it comes to dividend stocks? Of course, every income investor wants as much yield as possible. However, they also ...
-
When hunting for discounted investments, one excellent starting point is to look for businesses with dividend yields trading above their fiv...
-
Strange but true: seniors fear death less than running out of money in retirement. And unfortunately, even retirees who have built a nest eg...
-
While there’s nothing quite as exciting as betting everything on a hot growth enterprise, prudent investors may want to consider the best di...
Have you looked at HCP? The stock is my favorite REIT and it is yielding 4.5% currently.