NNN - Want Safe Income? This Stock Raised Its Dividend in the Last 4 Recessions.
2023-08-24 07:50:00 ET
Using the spread between 10-year and three-month Treasury rates as a gauge, economists estimate the probability of a U.S. recession occurring within the next 12 months at 66%. With an economic downturn looking more likely than not by next summer, now is still an appropriate time to prepare your portfolio for such an event.
One way to do so is to buy shares of companies with a record of raising their dividends through times of economic turmoil. Having delivered 34 consecutive years of payout increases, NNN REIT (NYSE: NNN) has done so through the Gulf War recession, the dot-com recession, the Great Recession, and the COVID-19 recession. Let's take a closer look at what makes the business exceptionally reliable.
NNN REIT specializes in buying single-tenant, net-lease retail properties from clients. This means that the company buys retail properties where there is only one tenant occupying the building. The client selling the property to NNN REIT agrees to pay a monthly base rent, as well as all taxes, insurance, and maintenance costs associated with a leased property, which makes it a triple-net-lease contract. These lease terms are often for a period of at least 10 years as well, with clauses for built-in rent growth. That builds visibility into the real estate investment trust's ( REIT ) steadily rising rent revenue base.
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Want Safe Income? This Stock Raised Its Dividend in the Last 4 Recessions.