SRC - This Phenomenal Dividend Stock's $9.3 Billion Acquisition Looks Like a Brilliant Move
2023-10-31 06:27:00 ET
Realty Income (NYSE: O) has one of the best dividend track records in the real estate investment trust (REIT) sector. The company has increased its payout 122 times since going public in 1994. Acquisitions have been the main factor driving its steadily rising dividend.
The REIT recently revealed its latest transformational deal. It's acquiring Spirit Realty (NYSE: SRC) for $9.3 billion. The transaction will immediately boost its cash flow while enhancing its size, scale, diversification, and growth runway. That should give it even more fuel to continue growing its monthly dividend , which currently yields an attractive 6.3%.
Realty Income is acquiring Spirit Realty in an all-stock, leverage-neutral transaction. The company expects that the acquisition will provide a meaningful earnings boost. It anticipates that the merger will increase its adjusted funds from operations ( FFO ) per share by over 2.5% in the first year. That assumes it will capture about $50 million in annual general and administrative (G&A) cost savings.
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This Phenomenal Dividend Stock's $9.3 Billion Acquisition Looks Like a Brilliant Move