Overall, REIT stocks trailed the S&P 500 during 2022 as the Federal Reserve's aggressive rate hikes made borrowing more expensive and acquisition activity slowed, but two REITs stock stood out in the year's performance. Both are casino landlords.
Out of 85 REIT and real estate stocks , with market cap over $2B, Vici Properties ( NYSE: VICI ) gained 8.5% YTD, and Gaming and Leisure Properties ( NASDAQ: GLPI ) rose 7.8%. By contrast, the S&P U.S. Equity All REIT Index sank 27% YTD and the S&P 500 fell 20%.
During Q1 2022, SA author Jonathan Weber, picked four REIT stocks that all surpassed the S&P 500's performance, but only VICI shares gained during 2022. "VICI's rent collection remained strong even during the pandemic, and its results and dividend continues to improve," he said. "Between future accretive acquisitions, organic growth, contracted rent increases, etc. VICI should be able to deliver some growth going forward," Weber added.
Bradley Guichard chose Vici ( VICI ) as one of three top picks for 2022. He specifically pointed to the gaming REIT's revenue and adjusted FFO increasing in 2020, even with COVID shutting the Las Vegas Strip in the Spring of 2020. "VICI went through its own ultimate stress test in the Spring of 2020 and passed with flying colors," he wrote at the time.
SA contributor Howard Jay Klein picked Gaming & Leisure Properties ( GLPI ) in February 2022. "It was the track record of GLPI since its inception that confirmed to me the conviction that it, and its prime competitor, Vici Properties ( VICI ), that casino REITs were stocks that belonged in every gaming portfolio," he said.
SA contributor Guichard assesses his own 2022 stock picks at year end.
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Gaming REIT stocks win in 2022 as broader REIT space languishes