VNQ - Is Agree Realty the Best High-Yield REIT Stock for You?
2024-05-30 05:19:00 ET
Agree Realty (NYSE: ADC) has a lofty dividend yield of 5%, which is drastically higher than the 1.3% on offer from the S&P 500 and notably above the 4.3% from the average real estate investment trust (REIT), using Vanguard Real Estate Index ETF (NYSEMKT: VNQ) as a proxy.
But is this high-yield REIT the right dividend stock for you? Here's what you need to know.
Before talking about today, it pays to revisit 2011, the year in which Agree Realty cut its quarterly dividend from $0.51 per share to $0.40 per share. There were two reasons for the cut. First, at that point Agree was a fairly small REIT, starting that year with just 81 properties. Second, Borders bookstore chain (roughly 20% of the rent roll) went bankrupt and terminated leases. Given the small size of the REIT at the time, it couldn't take the hit without reducing the dividend.
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Is Agree Realty the Best High-Yield REIT Stock for You?