REITs are increasingly popular for passive income due to consistent dividends, and attractive yields, especially as interest rates fall. With diversification across sectors like industrial and healthcare, they offer a reliable investment option.
Therefore, investors seeking high dividend yields may consider strong REITs like Crown Castle Inc. (CCI), VICI Properties Inc. (VICI), and Gaming and Leisure Properties, Inc. (GLPI), all yielding over 5%.
REITs provide a dependable income stream, distributing at least 90% of taxable income as dividends, making them ideal for investors focused on steady payouts, wealth growth, and inflation protection. With global REIT earnings expected to grow over 10% in 2024 and 2025, and a projected CAGR of 8.8% through 2031, their appeal continues to strengthen.
Meanwhile, with U.S. economic growth upgraded to 2.8% for 2024 and 2.2% for 2025, REITs could benefit from strong consumer spending and resilient labor markets. The IMF's forecast highlights the U.S. as a key driver of global growth, creating favorable conditions for property investments as demand remains robust.
Furthermore, diversified REITs spread risk across sectors, offering stability, while hotel REITs provide high returns during growth but are sensitive to market cycles. Overall, REITs present a balanced investment opportunity. Given this backdrop, let’s now dive into the stocks mentioned above in detail.
Crown Castle Inc. (CCI)
CCI operates and leases more than 40,000 cell towers and approximately 90,000 route miles of fiber, supporting small cells and fiber solutions across every major U.S. market. This nationwide portfolio of communications infrastructure connects cities and communities to essential data, technology, and wireless services, delivering information, ideas, and innovations to the people and businesses that need them.
On August 7, 2024, CCI announced a quarterly cash dividend of $1.56 per common share, payable on September 30, 2024, to stockholders of record as of September 13, 2024.
CCI has paid dividends for nine years. Its annual dividend is $6.26, which translates to a yield of 5.70% at the current share price. Its four-year average dividend yield is 4.30%. Moreover, the company’s dividend payouts have increased at a CAGR of 5.6% over the past three years.
CCI’s trailing-12-month asset turnover ratio of 0.17x is 30.6% higher than the 0.13x industry average. The stock’s trailing-12-month Return on Common Equity of 20.53% is 551% higher than the industry average of 3.15%. Also, its trailing-12-month Return on Total Assets of 3.23% is 147.6% higher than the industry average of 1.30%.
During the second quarter ended June 30, 2024, CCI reported net revenues of $1.65 billion. The company’s net income was $303 million, or $0.70 per common share, up 14.3% and 14.8%, respectively, from the year-ago figures. Additionally, the company’s total operating income rose 11.9% over the prior-year quarter to $544 million.
Street expects CCI’s FFO for the quarter ending June 30, 2025, to increase 5.6% year-over-year to $1.63. It surpassed the Street revenue estimates in each of the trailing four quarters. Over the past year, the stock has gained 28.1% to close the last trading session at $110.33.
CCI’s POWR Ratings reflect its strong fundamentals. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
It has a B grade for Momentum and Quality. Within the REITs – Diversified industry, it is ranked #14 out of 44 stocks. To see CCI’s ratings for Growth, Value, Stability, and Sentiment, click here.
VICI Properties Inc. (VICI)
VICI is an S&P 500 experiential real estate investment trust that owns one of the largest portfolios of market-leading gaming, hospitality, and entertainment destinations, including Caesars Palace Las Vegas, MGM Grand, and The Venetian Resort Las Vegas, three of the most iconic entertainment facilities on the Las Vegas Strip.
On September 5, 2024, VICI announced a 4.2% increase in its regular quarterly dividend to $0.43 per share, marking its seventh consecutive annual dividend increase. The dividend will be payable on October 3, 2024.
VICI pays an annual dividend of $1.73, which translates to a yield of 5.28% at the current share price. Its four-year average dividend yield is 4.90%. Also, the company’s dividend payouts have increased at a CAGR of 7.5% over the past three years. VICI has paid dividends for five consecutive years.
In terms of the trailing-12-month EBITDA margin, VICI’s 92.79% is 72.2% higher than the 53.88% industry average. Similarly, the stock’s 92.66% trailing-12-month EBIT margin is 322.9% higher than the 21.91% industry average. Moreover, its trailing-12-month net income margin of 99.02% is 51.1% higher than the 65.54% industry average.
In the second quarter that ended June 30, 2024, VICI’s total revenues increased 6.5% year-over-year to $957 million. Its adjusted EBITDA attributable to common stockholders grew 7.3% from the year-ago value to $775.87 million. The company’s net income was $752.75 million and $0.71 per common share, up 7.3% and 2.9% from the prior year’s quarter, respectively.
For the quarter ended September 30, 2024, VICI’s EPS and revenue are expected to increase 21.5% and 5.5% year-over-year to $0.67 and $954.31 million, respectively. Over the past year, VICI’s stock has gained 19.1% to close the last trading session at $32.77.
VICI’s bright prospects are reflected in its POWR Ratings. It has an overall rating of B, equating to a Buy in our proprietary rating system.
It has a B grade for Momentum, Stability, Sentiment, Quality. It is ranked #2 out of 16 stocks in the REITs – Hotel industry. To access the additional grades of VICI for Growth and Value, click here.
Gaming and Leisure Properties, Inc. (GLPI)
GLPI acquires, finances, and owns real estate properties leased to gaming operators under triple-net lease arrangements, where tenants are responsible for facility maintenance, insurance, taxes, utilities, and other services necessary for the leased properties and the businesses conducted on them.
On September 11, 2024, GLPI completed a $250 million land acquisition for Bally’s future Chicago casino, securing an 8% initial cash yield. GLPI's total investment for the project will reach $1.19 billion.
On August 28, 2024, GLPI announced a third-quarter 2024 cash dividend of $0.76 per share, payable on September 27, 2024, to shareholders of record on September 13, 2024.
GLPI’s annualized dividend of $3.04 per share translates to a dividend yield of 5.98% on the current share price. Its four-year average yield is 6.08%. Over the past three GLPI’s dividend payments have grown at CAGRs of 5.1%. GLPI has paid dividends for nine consecutive years.
GLPI’s 81.13% trailing-12-month AFFO payout ratio is 9.8% higher than the 73.86% industry average. Its trailing-12-month EBIT margin of 74.90% is 241.8% higher than the 21.91% industry average. In addition, the stock’s 71.58% trailing-12-month FFO to gross margin is 13.3% higher than the 63.19% industry average.
GLPI’s total income from real estate for the fiscal second quarter that ended June 30, 2024, increased 6.5% year-over-year to $380.63 million. Similarly, the company’s net income attributable to common shareholders and earnings per share stood at $208.25 million and $0.77, up 33.8% and 30.5% year-over-year, respectively.
Analysts expect GLPI’s revenue and FFO for the quarter ended September 30, 2024, to increase 7.2% and 3.2% year-over-year to $385.28 million and $0.97, respectively. GLPI surpassed the consensus revenue estimates in three of the trailing four quarters. The stock has declined 2.4% over the past month to close the last trading session at $50.81.
It’s no surprise that GLPI has an overall rating of B, which translates to a Buy in our proprietary rating system.
It has a B grade for Momentum, Stability, Sentiment, and Quality and is ranked #4 in the REITS - Diversified industry. In addition to what we have stated above, we have given GLPI grades for Growth and Value. Get all the GLPI ratings here.
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CCI shares were unchanged in after-hours trading Thursday. Year-to-date, CCI has gained 1.04%, versus a 23.01% rise in the benchmark S&P 500 index during the same period.
About the Author: Abhishek Bhuyan
Abhishek embarked on his professional journey as a financial journalist due to his keen interest in discerning the fundamental factors that influence the future performance of financial instruments.
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