Can Realty Income Sustain Growth While Paying Monthly Dividends?

Over its decades-long history, Realty Income O has built a reputation around its monthly dividend model, having declared its 664th consecutive monthly common-stock dividend of 26.95 cents per share in October 2025. In September, the dividend was also raised for the 132nd time, reflecting management’s confidence in recurring cash flows. That consistency supports the premise that the dividend is a core part of the value proposition and sets a high standard for the company to maintain. 

Realty Income’s operational and portfolio metrics give a strong platform for growth and dividend sustainability. As of June 30 2025, it managed a portfolio of more than 15,600 properties across the United States and Europe. The portfolio is weighted heavily toward single-tenant, triple-net lease structures (roughly 98% of assets) with a long weighted average lease term of approximately nine years, occupancy of 98.6% and a diversified tenant base across 91 industries (as of June 30, 2025). 

With a focus on non-discretionary, low-price-point or service-oriented retail tenants, around 90% of total rent is resilient to economic downturns and isolated from e-commerce pressures. These attributes reduce the volatility of cash flows and support predictable income streams, the kind of stability required to underpin a monthly dividend. Check Realty Income’s dividend history here.

Growth hasn’t stalled either. Realty Income invested roughly $2.5 billion during the first half of 2025 at a 7.3% yield. With strong visibility to its pipeline, it expects to deploy around $5 billion for the full year. The company continues to find opportunities in essential retail, industrial and international markets while maintaining more than $5 billion in liquidity to fund expansion without straining its balance sheet.

While challenges persist as rent growth stays modest and competition intensifies, Realty Income’s disciplined strategy and resilient portfolio continue to underpin stable cash flow and dividend reliability.

Dividend Appeal of Other Net Lease REITs

VICI Properties VICI stands out in the triple-net lease REIT sector with 6.6% annual dividend growth since 2018, outperforming peers like Agree Realty and Realty Income. Its yield is supported by premium gaming and hospitality assets, and a 75% AFFO payout target provides a stable income stream. A strong balance sheet and a diversified portfolio underpin VICI Properties’ long-term dividend sustainability. In September, VICI Properties announced a 4% quarterly dividend hike to 45 cents per share.

Agree Realty Corporation ADC mirrors this consistency, with 164 consecutive dividends paid and a 10-year CAGR of around 6%. Its 75% AFFO payout ratio reinforces reliable income, positioning Agree Realty alongside VICI Properties and other top net lease REITs in dividend stability. Recently, Agree Realty announced a 2.3% month-over-month increase in its monthly cash dividend to 26.2 cents per share, payable on Nov. 14, to stockholders of record at the close of business on Oct. 31, 2025.

O’s Price Performance, Valuation and Estimates

Shares of Realty Income have risen more than 12% year to date against the industry’s decline of 3.8%.

From a valuation standpoint, O trades at a forward 12-month price-to-FFO of 13.71, below the industry. It carries a Value Score of D.

While the Zacks Consensus Estimate for O’s 2025 FFO per share has been revised northward, the same for 2026 has been tweaked southward over the past 30 days.

At present, Realty Income carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.

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This article originally published on Zacks Investment Research (zacks.com).

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