Real estate investment trusts (REITs) are gaining popularity among investors as the consensus among economists is that the Federal Reserve will likely begin reducing interest rates later this year. This rate-sensitive sector is looking forward to lower re-financing costs and potential increased value of underlying properties. The sector also tends to pay regular, decent dividends, making them attractive to investors. Four specific REITs are currently offering attractive yields of 3% or better, spanning various industries including healthcare, retail, mortgages, and industrial assets.
National Health Investors is a REIT that manages 194 properties across 33 states in partnership with 30 operating partners. Their portfolio includes senior housing centers, skilled nursing sites, hospitals, and shopping centers. With a market capitalization of $2.73 billion, the stock has a price-earnings ratio of 20 and trades at 2.18 times its book value. Despite being lightly traded with an average daily volume of 174,000 shares, the company pays a substantial 7.16% dividend. Additionally, they recently reached a new high in their stock price.
Site Centers, another REIT, owns open-air retail properties in suburban areas of major U.S. cities. With a market capitalization of $3.07 billion, the stock trades at 1.53 times book and has a price-earnings ratio of 12. Despite a decrease in earnings this year, their earnings have increased over the past 5 years. Investors are offered a 3.55% dividend with this REIT, which specializes in properties such as the Ahwatukee Foothills Towne Center in Phoenix, Arizona, and Nassau Park Pavillion in Princeton, New Jersey.
Terreno Realty is a REIT that owns and operates industrial retail facilities in major coastal markets across the U.S. With a market capitalization of $5.99 billion, the stock has a price-earnings ratio of 37 and trades at 1.99 times book. Despite a decrease in earnings this year, their earnings have increased over the past 5 years. The company pays a 3.24% dividend and recently reached a new high in their stock price. TPG RE Finance Trust is a balance sheet lender that provides first-mortgage loans greater than $50 million in primary and select secondary U.S. markets. With a market capitalization of $601 million, the stock has a forward price-earnings ratio of 7.52 and trades at 53% of its book value. The company pays a high dividend of 15.54%, although their debt-to-equity ratio is on the higher side.
Overall, REITs are gaining traction among investors as the Federal Reserve is anticipated to reduce interest rates. The sector offers attractive dividends, making them appealing to investors looking for regular income. Specific REITs such as National Health Investors, Site Centers, Terreno Realty, and TPG RE Finance Trust are currently offering yields of 3% or better, with each specializing in different types of properties. Investors are keeping a close eye on these REITs as they continue to reach new highs in their stock prices and navigate through market fluctuations.
