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Real Estate Monthly Passive Income

For investors seeking consistent monthly income along with using passive vehicles, look at stocks with monthly dividends. Imagine, having multiple monthly income streams such as 10 or more stocks paying you each month. Then, add covered call investments from Get Rich Investments to live the life your desire.

Realty Income Corp styles itself as “the Monthly Dividend Company,” and frankly, this conservative retail real estate investment trust (REIT) deserves the title of king of the monthly dividend stocks. Realty Income has paid its investors like clockwork for 559 consecutive months and even raised its dividend for 77 consecutive quarters.

It has a yield of 3.9%, a stock is always going to be considered more risky than a bond, but Realty Income is about as close to a bond as you can realistically get in the stock market. Its cash flows are backed by long-term leases to high-quality tenants. Its properties are generally high-traffic retail sites that are mostly recession proof and “ proof.”

We see total revenue growth of approximately 7% in 2019, moderating to 5% to 7% in 2020 driven by acquisitions, rising rents and stable occupancy. Occupancy at the end of Q4 2018 was 98.6%, near the highest occupancy rate within the past 10 years and up from 98.4% in the prior year. We estimate occupancy to remain near its historical average of 98% due to the desirable locations and non-discretionary retailer demand.

We raise our target price by $8 to $73, equal to 22.4x our 2019 FFO per share estimate of $3.26, and above the peer average of 15.5x. We start 2020’s FFO estimate at $3.40. O reported Q4 FFO of $0.73 vs. $0.61, $0.01 below consensus. Year-end occupancy increased to 98.6% from 98.4% in the prior year while rents under lease were up 0.8% for Q4 and up 0.9% for the year, which we find acceptable given O’s tenants are under triple-net leases. We continue to believe O will execute well and stick to its core competencies. We like that O has taken advantage of its current stock price and a favorable market, raising $539 million in Q4 from sale of common stock, a prudent move to help fund future acquisitions. We think long-term investors will continue to benefit from O’s predictable cash flow, but we reiterate our Hold opinion on valuation. O usually trades at a 20% premium-to-net asset value (NAV), but at its current 40% premium we would wait for a more attractive opportunity to buy.


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Companies Increasing Dividends

Realty Income Corporation (O), known as “The Monthly Dividend Company”,  announced that its Board of Directors has declared an increase in the Company’s common stock monthly cash dividend to $0.151125 per share from $0.146125 per share. The dividend is payable on September 17, 2012 to shareholders of record as of September 4, 2012.  This is the 67th dividend increase since Realty Income  went public in 1994. The new monthly dividend amount represents an annualized dividend amount of $1.8135 per share as compared to the previous annualized dividend amount of$1.7535 per share. The Company continues its long-term policy of declaring and paying dividends on a monthly, rather than on a quarterly, basis.

Realty Income has a current dividend yield of 4.2%.  The Company has averaged an annual dividend increase of 2.72% over the last 5 years.

Northrim BanCorp, Inc. (NRIM) announced its Board of Directors increased its regular quarterly cash dividend 15% to $0.15 per share from $0.13 per share in the preceding quarter. The dividend will be paid September 14, 2012, to shareholders of record at the close of business September 6, 2012. Northrim has paid a regular quarterly cash dividend since 1995, and offers a current annualized dividend yield of 2.86% at current market share prices.

Northrim BanCorp recently reported net profits of $3.1 million, or $0.48 per diluted share, in the second quarter of 2012, compared to $2.6 million, or $0.39 per diluted share, in the preceding quarter and $3.2 million, or $0.49 per diluted share, in the second quarter a year ago.

Northrim Bancorp has an equity summary score of 9.7 out of 10 for a VERY Bullish outlook.  Analysts have a consensus rating of 1.5 for a strong buy rating.

Bob Evans Restaurants (BOBE) approved a 10% increase in the quarterly dividend rate, from 25 cents per share to 27.5 cents per share. The increased dividend is payable on Monday, September 17, 2012, to shareholders of record at the close of business on Tuesday, September 4, 2012.

CEO Davis said, “Improved sales performance at Bob Evans Restaurants and BEF Foods gives us the confidence to raise our dividend rate for the seventh consecutive year.  Our new annual dividend rate of $1.10 per share represents a 129 percent increase from the $0.48 per share rate in fiscal 2006.  Our strong balance sheet enables us to deliver adjusted earnings growth through disciplined capital investments, and it also enables us to continue to return cash to our shareholders.  We are committed to this balanced approach of driving shareholder value through ongoing investments in the business, and return of cash to shareholders.”

Bob Evans has a dividend yield of 2.74%.  Bob Evans has an equity summary score of 9.8 out of 10 for a VERY Bullish outlook.  Analysts have a consensus rating of 2.8 for a hold rating.

GameStop Corp. (GME) declared a quarterly dividend of $0.25 per share, or $1 annualized. This is a 66.7% increase from the prior dividend of $0.15.  The dividend will be payable on September 12, 2012, to stockholders of record on August 28, 2012, with an ex-dividend date of August 24, 2012.

Gamestop has an annual dividend yield of 5.9%.  GameStop has an equity summary score of 7.7 out of 10 for a Bullish outlook.  Analysts have a consensus rating of 2.4 for a buy rating.

Parkway Properties, Inc. (PKY) announced today that its Board of Directors declared a quarterly dividend of $0.1125 per share, a 50% increase from the prior quarterly amount and higher than the previously announced anticipated increase.  The dividend is payable on September 26, 2012 to shareholders of record for Common Stock on September 12, 2012.  This dividend is the 104th consecutive quarterly distribution to Parkway’s shareholders of Common Stock and represents an annualized dividend rate of $0.45 per share.

Funds from operations (“FFO”) available to common shareholders totaled $7.9 million, or $0.32 per diluted share for the second quarter 2012, as compared to $1.7 million, or $0.08 per diluted share, for the prior year period. Recurring FFO totaled $9.3 million, or $0.38 per diluted share for the second quarter 2012, as compared to $12.7 million, or $0.59 per diluted share, for the prior year period.

Parkway Properties has an equity summary score of 7.8 out of 10 for a Bullish outlook.  Analysts have a consensus rating of 2.8 for a hold rating.

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