Here's My Top Dividend Stock for 2026

In 2023, W.P. Carey (NYSE: WPC) destroyed its dividend record, cutting its payout after 24 consecutive years' worth of dividend increases. The company said the move would make it a better net lease real estate investment trust (REIT) for the future, a storyline that is playing out just as promised. Here's why this dividend cutter is a top dividend pick in 2026.

The net lease bellwether is Realty Income

Realty Income (NYSE: O) is the name that most people think about when they look at the net lease niche of the broader REIT sector. (A net lease requires the tenant to pay most property-level operating costs.) With a three-decade-long streak of annual dividend increases behind it, there's a good reason investors like Realty Income. Add in Realty Income's huge size, with a market cap of $52 billion, and you can see why it stands out as an investment.

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Of course, it helps that Realty Income also offers a hefty 5.7% dividend yield. I own this REIT and have no intention of selling it anytime soon. It is the net lease REIT to which all other net lease REITs should be compared. But I also own W.P. Carey, the No. 2 player in the net lease niche. And in 2026, W.P. Carey is likely to be a much more interesting dividend stock than Realty Income.

Realty Income vs. W.P. Carey: They are doing different things

There's nothing wrong with Realty Income. It is a foundational dividend investment. But it is a slow-growth business, and that's pretty much all investors should expect from it. W.P. Carey is likely to provide more growth in 2026 and beyond. The first reason for that is simple: W.P. Carey's $14.5 billion market cap means it doesn't take as much investment to move the needle on the top and bottom lines.

But there's more to the story and it starts with the 2023 dividend reduction. That move was precipitated by W.P. Carey's decision to exit the office property niche in one quick move. It was a large portion of the investment portfolio, so the dividend needed to be cut.

However, the quarter after that the dividend got right back onto the same quarterly dividend hike path as before the cut. This is why the reduction was made from a position of strength. Every quarter since the cut, the dividend has been increased.

The promise at the time of the reduction was that exiting the office market would set W.P. Carey up for faster growth. The first piece of that was the REIT's opportunity to reinvest the proceeds from selling the office properties. But the future opportunity is the REIT's ability to invest more aggressively now that it is focused on industrial, warehouse, and retail assets. That focus has played out well in 2025. Notably, in the third quarter of 2025, W.P. Carey's adjusted funds from operations (FFO) per share rose a healthy 5.9%. That compares to 2.9% for Realty Income.

So W.P. Carey's business grew at about twice the rate of Realty Income's in the quarter. But that was just the quarter. Through the first nine months of 2025 Realty Income's adjusted FFO increased by 1.6% or so while W.P. Carey's growth came in at 6%. That's more than three times the growth rate of Realty Income.

If Realty Income is a slow and steady Goliath, W.P. Carey has transformed itself into a fast-growing (for a REIT) David. That's also highlighted in the dividend. Realty Income's dividend in the third quarter of 2025 was 2.3% higher than it was in the same period in 2024. W.P. Carey's dividend in the quarter was 4% higher. These trends are likely to continue in 2026 and frankly, for years to come. This is thanks to W.P. Carey's smaller size even though, like Realty Income, it has a diversified portfolio with a global reach.

I'm going for a double play

The truth is, I own both W.P. Carey and Realty Income. I think they pair up nicely together, with Realty Income more focused on retail assets and W.P. Carey leaning toward industrial properties. I see Realty Income as the foundation and W.P. Carey as adding a bit of growth to the story.

And it is hard to complain about W.P. Carey's 5.4% dividend yield, even though it is slightly lower than Realty Income's 5.7%. I'm willing to pay what amounts to a fairly modest premium for the growth opportunity I foresee for W.P. Carey's business in 2026 and beyond.

Reuben Gregg Brewer has positions in Realty Income and W.P. Carey. The Motley Fool has positions in and recommends Realty Income. The Motley Fool has a disclosure policy.