Matthew Waterman
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Matthew Waterman in Brand Power,

Realty Income Probably Has Further To Fall

Before I get too far into this post, I want to preface this advice with the suggestion that with your REITs, you should be sticking to an allocation strategy, and not so much a uniform valuation that you might apply to most other kinds of stocks. Reason being is that most REITs don't play by normal stock market rules; rather they fluctuate based more on things like current dividend yield and interest rate environments. For more about this, see this post here

That said, Realty Income Corp. (O) is looking a little rich and probably will come down. The sweet spot on this company seems to be somewhere around a 5% yield. The current 4.02% yield means the price is on the high side historically, and might indeed have further to fall. If you have too much of your money in REITs, this might be a good place to trim. If not, stay right where you are and let the monthly dividends smooth things out for you.