O - NNN REIT Q4: A Wonderful REIT At A Great Price

2024-02-12 07:00:00 ET

Summary

• NNN REIT continues to perform well, beating FFO estimates and growing their portfolio with $800 million in acquisition volume, their third highest year since 2007.
• The company maintains a secure dividend with a conservative payout ratio of roughly 69%.
• NNN REIT is currently trading at an attractive price, below its 5-year average, with potential for price appreciation if interest rates are cut.
• Full-year FFO guidance for 2024 is expected to be slightly higher than 2023 at $3.25 to $3.31.
• Higher interest rates will continue to be a headwind with some not expecting rate cuts until May instead of March.

Introduction

NNN REIT ( NNN ) is one of the first REITs I ever bought when I switched my strategy to strictly investing for income. One thing that stood out to me was their conservatism. The company never blows earnings out of the water nor is it super popular amongst investors. In comparison to peer Realty Income ( O ), whom I also hold and enjoy, NNN seems to fly under the radar. And one thing I enjoy about the company is they just continue to perform. Nothing flashy, just a steady eddy blue-chip stock that helps me sleep well. During their close out earnings for 2023 they continued this trend, showing why they're one of the best in the business.

Previous Thesis

I last covered NNN REIT back in November along with another favorite in the sector of mine, Agree Realty ( ADC ) in an article: Solid Earnings Show Why Both SWANs Are Great Buys Right Now. Since then, NNN is trading roughly $1 higher than the share price at that time....

For further details see: