June 11, 2025 a 11:31 am
📊 Dividend Analysis - Realty Income Corporation
Realty Income Corporation, also known as The Monthly Dividend Company, stands as a stalwart in the real estate investment trust sector. With a dividend yield at 5.62% and a remarkably extensive history of 32 years of dividend payouts without cuts, this company exemplifies a robust commitment to returning value to its shareholders. The current dividend per share is approximately $3.09, placing Realty Income among the top choices for income-focused investors.
🗣️ Overview
Realty Income Corporation, a leader in the REIT sector, has maintained a strong dividend yield and consistent payouts, reflecting its stable cash flow and earning capacity.
| Metric | Value |
|---|---|
| Sector | Real Estate |
| Dividend yield | 5.62% |
| Current dividend per share | 3.09 USD |
| Dividend history | 32 years |
| Last cut or suspension | None |
📈 Dividend History
The company's established dividend history is a testament to its reliable income generation capabilities. Consistent dividend payments are a key metric for evaluating investment quality, indicating the company's prioritization of shareholder returns.
| Year | Dividend Per Share (USD) |
|---|---|
| 2025 | 1.60 |
| 2024 | 2.87 |
| 2023 | 3.06 |
| 2022 | 2.97 |
| 2021 | 2.77 |
📉 Dividend Growth
The dividend growth rate over the past three to five years highlights the company's ability to enhance shareholder value. This gradual increase not only indicates the firm's earnings capability but also reflects management's confidence in future performance.
| Time | Growth |
|---|---|
| 3 years | 1.12% |
| 5 years | 1.71% |
The average dividend growth is 1.71% over 5 years. This shows moderate but steady dividend growth.
✅ Payout Ratio
Payout ratios are critical in evaluating dividend sustainability. A high EPS payout ratio of 281.77% may raise concerns, although it can be typical for REITs due to non-cash expenses like depreciation. Meanwhile, a FCF payout ratio at 77.94% suggests reasonable sustainability.
| Key figure | Ratio |
|---|---|
| EPS-based | 281.77% |
| Free cash flow-based | 77.94% |
📊 Cashflow & Capital Efficiency
Examining cash flow efficiency and capital deployment offers insights into the company's operational effectiveness. Realty Income's metrics highlight robust cash flow coverages, which underpin its dividend payments and growth strategies.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 7.66% | 7.44% | 6.61% |
| Earnings Yield | 1.85% | 2.19% | 2.24% |
| CAPEX to Operating Cash Flow | 0% | 0% | 0% |
| Stock-based Compensation to Revenue | 1.09% | 0.64% | 0.65% |
| Free Cash Flow / Operating Cash Flow Ratio | 1.00 | 1.00 | 1.00 |
With a consistent free cash flow yield and operating cash flow ratio, Realty Income illustrates solid cash flow management, essential for sustaining its dividend policy.
⚠️ Balance Sheet & Leverage Analysis
Assessing the balance sheet provides an understanding of the company's leverage and financial stability, crucial in gauging its ability to weather economic fluctuations.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 0.69 | 0.67 | 0.68 |
| Debt-to-Assets | 0.39 | 0.38 | 0.39 |
| Debt-to-Capital | 0.41 | 0.40 | 0.40 |
| Net Debt to EBITDA | 6.34 | 6.04 | 6.60 |
| Current Ratio | 1.45 | 1.23 | 1.48 |
| Quick Ratio | 1.68 | 1.21 | 1.45 |
| Financial Leverage | 1.77 | 1.75 | 1.73 |
Despite its elevated leverage common in the REIT sector, Realty Income's ratios indicate a manageable debt level supporting its continuing dividend distributions.
✅ Fundamental Strength & Profitability
Key profitability ratios are vital indicators of the company's financial health and return-generating capability, affecting its capacity to sustain and enhance dividend payments.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 2.22% | 2.65% | 3.03% |
| Return on Assets | 1.25% | 1.51% | 1.75% |
| Net Margin | 16.33% | 21.39% | 26.00% |
| EBIT Margin | 36.65% | 41.87% | 43.06% |
| EBITDA Margin | 82.10% | 88.33% | 87.59% |
| Gross Margin | 92.84% | 92.23% | 42.36% |
| Research & Development to Revenue | 0.00% | 0.00% | 0.00% |
Realty Income's margins indicate strong operational management. The robust EBIT and EBITDA margins underscore its ability to maintain profitability, supporting dividend reliability.
📉 Price Development
📊 Dividend Scoring System
| Category | Score | |
|---|---|---|
| Dividend yield | 4/5 | |
| Dividend Stability | 5/5 | |
| Dividend growth | 3/5 | |
| Payout ratio | 3/5 | |
| Financial stability | 4/5 | |
| Dividend continuity | 5/5 | |
| Cashflow Coverage | 4/5 | |
| Balance Sheet Quality | 3/5 |
Total Score: 31/40
🏆 Rating
Realty Income Corporation secures a commendable position in the REIT sector, offering a reliable dividend yield and a solid growth trajectory. While high payout ratios indicate some areas for vigilance, its robust operational structure and consistent dividend history make it a favorable choice for income-seeking investors. We recommend a "Buy" stance for those aiming to bolster their portfolio with stable, long-term dividend income.