In the world of real estate investment trusts (REITs), three companies have stood out by hitting new price highs while offering dividends of over 3%. These companies include Sabra Healthcare REIT, which specializes in managed senior housing and healthcare properties, CareTrust REIT, which focuses on skilled nursing care and senior housing, and InvenTrust Properties, a retail REIT that invests in shopping centers. Despite the recent downward trend in the REIT market, these companies have managed to defy expectations and continue their upward trajectory. With attractive dividend yields and potential for growth, these REITs are worth considering for investors looking to maximize their returns in the real estate sector.
REITs Hitting New Highs And Paying 3+% Dividends
This image is property of specials-images.forbesimg.com.
Introduction and Background
In the world of real estate investment, there are several options for investors to consider. One popular choice is real estate investment trusts, or REITs. These companies allow individuals to invest in real estate without directly owning the properties themselves. Instead, individuals can buy shares of these trusts, which are traded on the stock market. What makes REITs particularly attractive to investors is the fact that they often pay out dividends, providing a steady stream of income. In this article, we will explore three specific REITs that have recently hit new price highs and also offer dividends of over 3%.
Overview of REITs and their Purpose
Before diving into the specific REITs that are performing well, it is important to understand what a REIT is and its purpose. A real estate investment trust is a company that owns, operates, or finances income-generating real estate. These properties can include commercial buildings, apartment complexes, hotels, and more. The purpose of a REIT is to allow investors to pool their money together in order to invest in a diversified portfolio of real estate assets. By doing so, investors can benefit from the potential increase in property values and also receive dividends from the income generated by the properties.
Dwindling Prices of REIT ETFs
While REITs as a whole have been performing well, it is important to note that the prices of REIT exchange-traded funds (ETFs) have been on the decline. ETFs are investment funds that are traded on stock exchanges, much like individual stocks. They allow investors to gain exposure to a specific sector or industry without having to buy individual stocks. The iShares U.S. Real Estate ETF is a popular benchmark ETF that holds a diversified selection of 73 REITs in its portfolio. However, its price chart has shown a downward trend, with the price dropping below the March low. This indicates weakness in the ETF and suggests a bearish outlook for the interest rate-sensitive sector.
Analysis of iShares U.S. Real Estate ETF
The iShares U.S. Real Estate ETF is one of the most widely recognized ETFs in the real estate sector. Despite its recent decline in price, it is important to note that individual REITs can still perform well even when the overall sector is experiencing a downturn. Investors who are interested in investing in REITs should consider conducting thorough research and analysis on individual companies rather than relying solely on the performance of the ETF.
REITs with New 52-Week Highs
Despite the general trend of declining prices in REIT ETFs, there are still individual REITs that have been hitting new price highs. Three such REITs are Sabra Healthcare REIT, CareTrust REIT, and InvenTrust Properties.
Sabra Healthcare REIT
Sabra Healthcare REIT focuses on investing in managed senior housing, skilled nursing facilities, and other healthcare-related properties. This REIT recently received an upgrade in opinion from Bank of America Securities, changing their rating from “neutral” to “buy” with a price target of $14 to $16. Sabra Healthcare REIT also offers an attractive dividend yield of 8.46%.
CareTrust REIT
CareTrust REIT specializes in owning and operating skilled nurse care facilities and senior housing properties, including assisted living centers. Although there are no earnings reported for this year, analysts are optimistic about the company’s growth potential, with an estimated 53% growth for the next year. Investors in CareTrust REIT can also benefit from a dividend yield of 5.23%.
InvenTrust Properties
InvenTrust Properties is a retail-focused REIT that primarily invests in open-air shopping centers, primarily located in the South and Southwest regions of the United States. While earnings have decreased by 90% for this year, analysts estimate a significant 171% growth for the next year. InvenTrust Properties also provides investors with a dividend yield of 3.31%.
Conclusion
Despite the declining prices of REIT ETFs, there are still individual REITs that are hitting new highs and offering attractive dividend yields. Investors interested in the real estate sector should consider conducting thorough research on individual REITs and analyzing their potential for growth and income. Sabra Healthcare REIT, CareTrust REIT, and InvenTrust Properties are three examples of REITs that have recently been performing well and could be worth considering for investors seeking both capital appreciation and dividend income. Remember to always carefully consider your investment goals and risk tolerance before making any investment decisions.
Source: https://www.forbes.com/sites/johnnavin/2023/10/13/3-reits-hitting-new-highs-and-paying-3-dividends/
