Key Reasons to Add VICI Properties Stock to Your Portfolio Now

VICI Properties VICI boasts a high-quality portfolio of market-leading gaming, hospitality and entertainment destinations. Its mission-critical assets and long-term triple-net lease agreements with its tenants assure stable rental revenues. A healthy balance sheet position is likely to support its growth endeavors.

Last month, VICI Properties reported first-quarter 2025 adjusted funds from operations (AFFO) per share of 58 cents, in line with the Zacks Consensus Estimate. The figure increased 3.6% from the prior-year quarter. Results reflected a year-over-year rise in revenues, mainly driven by income from sales-type leases and income from lease financing receivables, loans and securities. However, higher interest expenses in the quarter acted as a dampener.

Analysts seem bullish on this Zacks Rank #2 (Buy) company. The Zacks Consensus Estimate for VICI’s 2025 FFO per share has moved one cent northward over the past month to $2.34.

In the past three months, shares of this company have risen 5.6% compared with the industry's flat growth.

Factors That Make VICI Properties a Solid Pick

Robust Portfolio Supports Reliable Income: VICI Properties is a triple-net lease REIT that owns one of the largest high-quality portfolios of market-leading gaming, hospitality, wellness, entertainment and leisure destinations. The company's 100% occupancy rate reflects the mission-critical nature of its properties to their tenants, who cannot easily relocate without significant costs and regulatory approval. These factors provide VICI with consistent, reliable income and a dominant position in a lucrative market.

Favorable Long-Term Leases: VICI Properties generally offers lease agreements with initial terms ranging from 15 to 32 years. These agreements are also equipped with several tenant renewal options, enabling the lease to be extended for an additional five to 30 years. Its long-term triple-net lease agreements with its tenants ensure a consistent revenue stream, accompanied by inherent growth potential.

Moreover, VICI Properties maintains a mutually beneficial relationship with all its tenants, who are leading owners and operators of gaming, leisure and entertainment properties. 79% of the company’s rent comes from publicly traded tenants. Coupled with a creditworthy tenant base, including 79% of rent roll from S&P 500 tenants, VICI’s revenues are secure and transparent.

Balance Sheet Strength: VICI Properties focuses on enjoying financial flexibility, and as of March 31, 2025, the company’s liquidity totaled $3.21 billion. The last quarter’s annualized net leverage ratio was 5.3 as of March 31, 2025, within the long-term net leverage target of 5.0-5.5.

VICI Properties enjoyed investment-grade credit ratings of ‘Baa3,’ ‘BBB-’ and ‘BB-’ from Moody’s, S&P Global Ratings and Fitch Ratings, respectively, as of the end of the first quarter of 2025, rendering it favorable access to the debt market.

Encouraging Dividend Distributions: Solid dividend payouts remain the biggest attraction for REIT investors, and VICI Properties has remained committed to that. With a 7.4% annual dividend growth rate since 2018, it outpaces many peers in the triple-net REIT sector. Moreover, VICI Properties has increased its dividend five times in the last five years, and its five-year annualized dividend growth rate is 7.54%. Given a robust operating platform and decent financial position, its dividend distribution is expected to be sustainable over the long run.

Other Stocks to Consider

Some other top-ranked stocks from the broader REIT sector are W.P. Carey WPC and Cousins Properties CUZ, each carrying a Zacks Rank of #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for W.P. Carey’s full-year FFO per share is pegged at $4.88, which indicates an increase of 3.8% from the year-ago period.

The Zacks Consensus Estimate for CUZ’s 2025 FFO per share is pegged at $2.79, which calls for year-over-year growth of 3.7%.

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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