Hi, I'm Jimmy.
In this video, we're gonna look at five dividend paying REITs.
That could be great long term investments for dividend investors, a REIT, just so we're
all on the same page is short for real estate investment trust.
And basically, it's a way to invest in real estate, but through the stock market.
So the goal of this video is to see if we can identify some specific dividend paying
REITs that are potentially great long term investments that could fit into or one of
them at least could fit into each of our investment portfolios.
So I tried to vary where they come from and what they focus on.
That way.
We don't end up with just five dividend paying REITs that do the exact same thing.
Okay, so let's jump in our first real estate investment trust is QTS realty trust ticker
symbol QTS.
QTS currently has a dividend yield of about 3%.
And what QTS does is that they're developers, operators and owners of data centers, data
centers, I think, have great long term opportunities from a growth perspective.
So we'll come back to this one later.
But this is a smaller REIT, they have a market cap of about $4 billion.
But I do think that again, they have some upside since data centers are likely to continue
to grow for many years.
Okay.
Now, I also think it makes sense for us to take a peek at price to funds from operations
for each of the REITs that we're looking at today.
And if we're curious funds from operations for a REIT is sort of like a cash flow from
operations for a regular company.
So we can compare that to the current price.
And we end up with something closer to price to earnings or even price to free cash flow.
Now, often times, it may make sense for us to look at funds from operations rather than
something like a more traditional earnings per share, when we're analyzing REITs.
So as you can see, QTS is current price to funds from operations or FFO for short, well
they're currently trading at about 22 x.
Now, this is tied for highest on our list.
And another good REIT is a company called Digital realty trust.
They do something very similar to this REIT, but they have funds from operation price to
funds from operation of about 28 x right now.
That's why I elected to go with this one.
Although if we were looking for a bigger company, digital realty trust, their ticker is DLR,
they're also quite good.
But again, I was looking for a lower ratio, cuz in theory they could be better price.
Okay, now shifting back to QTS.
Well, QTS, we could see their dividend history has been rather consistent for the past few
years.
So overall, I'm a fan of QTS, or even DLR.
So I think that these types of REITs will do well and I've actually got another one
later on in the video.
Okay, now let's shift over to our second real estate investment trust in public storage.
ticker symbol PSA public storage has a dividend yield of about three and a half percent right
now.
Their price to FFO is about 22 x tied with the company from before.
And they own a bunch of storage facilities.
As we may have guessed, now, when we pull up their dividend history, well, we can see
that they have consistently paid out about $2 per quarter in dividends.
So $8 per year in dividends.
So from a dividend perspective, this has been quite consistent for dividend investors.
And I expect for this REIT to continue to do well over the long run.
Okay, next up, we have a more conservative REIT, called the Gladstone land Corporation,
ticker symbol LAND Gladstone has a dividend yield of about three and 3.8%.
And they're currently trading at 21 times funds from operations.
Now for a curious why I call it a conservative REIT.
Well, what they do is they own land, and they rent out that land, to corporate and independent
farmers.
So basically, they own a whole ton of farmland, and it's likely that this will be a solid
long term business since people are likely to always need food.
Okay.
Now, once again, I should point out that this is a much smaller REIT, their market cap is
just $300 million.
So it is fairly small, but I thought it made sense to include some smaller REITs in this
whole thing, because oftentimes, people don't talk about some smaller opportunities that
in theory, have some growth opportunities that may be some of the larger REITs don't
have and if you're curious, this is their dividend history going back the past few years,
so it looks to be heading in the right direction.
Okay, now we're shifting back to a larger REIT in Cyrus one ticker symbol CONE and he
once again, Cyrus one focuses on data centers, and they're one of the largest data center
providers in the United States, although they are a global data center company.
Right now, they have a dividend yield of about 2.8%.
And they're trading at just 18 times FFO.
So overall, this could be a good dividend REIT for the long run, and we take a peek
at their dividend history, or we can see that they've had some nice growth.
Their dividends for the past few years.
Okay, moving right along.
Up next we have the Alexandria real estate equities company, ticker symbol ARE.
Well, what this really does is they lease out properties to the pharmaceutical, biotech,
they have some research companies, they have some personal care product companies, they
lease out buildings and properties to companies like that in those sectors.
So once again, I expect for these types of industries and companies to do well for the
long run.
And I also expect that largely, these are going to be industries that have to work in
person, or at least have benefits of working in person versus remote in many other industries.
So I would expect this type of REIT real estate company to do well, since they're likely to
keep a lot of their tenants.
Now, Alexandria has a dividend of about 2.7%.
And they currently trading at a price to FFO of about 16 x.
So Alexandria has the lowest price to FFO on our whole list, which implies that at least
compared to the other REITs that we're looking at, they could be a bit more undervalued.
And then we check out their dividend history.
Or we can see that they've had some impressive growth in their dividend in the past few years.
Now, one of the advantages of REITs is that they don't have to pay corporate income taxes,
as long as they pay out most of their profits to their shareholders, which is how we can
end up with great dividends from relatively small companies, or even new REITs.
That's often one of the reasons I one of the primary contributing factors as to why REITs
can have good dividends.
And I recognize that REITs are a bit unusual when compared to more traditional companies,
and actually did a REIT primer video not too long ago, where I run through the basics of
what a REIT is, and what makes them unique.
So if you're curious, perhaps that could be a good next video for you to watch.
I got a link right here.
I got a link in the description below.
And thank you so much for sticking with me all the way to the end of the video.
I really appreciate it.
Thanks and I'll see in the next video.