Realty Income: A 131-Year Dividend Growth Record and Fortified Balance Sheet for Reliable Passive Income Generation

Realty Income (NYSE: O) is a real estate investment trust (REIT) that has consistently delivered on its promise of a high-yielding monthly dividend to its investors. Since its public market listing in 1994, the company has raised its dividend payment 131 times, making it an ideal stock to buy and hold for passive income. The REIT's high-yielding payout is on a rock-solid foundation, with a diversified portfolio of over 15,600 retail, industrial, gaming, and other properties net leased to leading companies such as 7-Eleven, Dollar General, FedEx, Home Depot, and Walmart. Its focus on investing in properties secured by long-term net leases enables the REIT to generate very predictable cash flow because tenants cover all property operating expenses. Realty Income pays out a conservative percentage of its stable cash flow in dividends, which gives it a comfortable cushion while allowing it to retain meaningful excess free cash flow to invest in more income-generating properties each year. The REIT also has a fortress balance sheet, with two bond ratings of A3/A- or higher, providing it with lower borrowing costs to fund new investments. The company estimates that the total addressable market for net lease real estate is $5.5 trillion in the US and $8.5 trillion in Europe. Realty Income has been steadily growing its opportunity set by expanding into new property verticals and additional European markets, adding a credit investment platform, and launching a private capital fund in the US. Its growing diversification has further expanded its already massive growth runway. Recently, Realty Income declared its latest monthly dividend payment of $0.269 per share in mid-July to those who own the stock by the first of next month. That raises its annualized dividend rate to $3.228 per share, which is a more than 5.5% yield at its recent stock price. The payout is 0.2% higher than its last payment and 2.3% above the year-ago level. CEO Sumit Roy commented on Realty Income's latest dividend declaration, stating that "The quality and diversification of Realty Income's portfolio allows us to provide investors reliable monthly dividends that increase over time." He also remarked that "During times of market uncertainty, Realty Income remains committed to delivering investors predictable income streams." In summary, Realty Income is an excellent choice for investors looking for a reliable source of passive income through monthly dividends. With a strong track record of dividend increases and a diversified portfolio of high-quality properties, this REIT is well-positioned to continue delivering strong returns for years to come. However, before investing in Realty Income, it's essential to consider the broader market and the potential risks associated with any investment.