Reviewing Realty Income (O) & Its Rivals

Realty Income (NYSE:O) is one of 85 public companies in the “Retail REITs” industry, but how does it weigh in compared to its rivals? We will compare Realty Income to related businesses based on the strength of its earnings, valuation, institutional ownership, dividends, profitability, risk and analyst recommendations.

Dividends

Realty Income pays an annual dividend of $3.26 per share and has a dividend yield of 5.5%. Realty Income pays out 224.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Retail REITs” companies pay a dividend yield of 230.4% and pay out 78.0% of their earnings in the form of a dividend. Realty Income has raised its dividend for 31 consecutive years. Realty Income lags its rivals as a dividend stock, given its lower dividend yield and higher payout ratio.

Valuation and Earnings

This table compares Realty Income and its rivals revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Realty Income	$5.75 billion	$1.06 billion	41.10
Realty Income Competitors	$824.12 million	$253.68 million	9.10

Realty Income has higher revenue and earnings than its rivals. Realty Income is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Volatility & Risk

Realty Income has a beta of 0.65, suggesting that its share price is 35% less volatile than the S&P 500. Comparatively, Realty Income’s rivals have a beta of 0.88, suggesting that their average share price is 12% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and price targets for Realty Income and its rivals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Realty Income	1	10	5	2	2.44
Realty Income Competitors	963	3987	3457	139	2.32

Realty Income presently has a consensus price target of $71.69, suggesting a potential upside of 20.28%. As a group, “Retail REITs” companies have a potential upside of 8.86%. Given Realty Income’s stronger consensus rating and higher probable upside, equities analysts plainly believe Realty Income is more favorable than its rivals.

Profitability

This table compares Realty Income and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Realty Income	21.85%	3.27%	1.80%
Realty Income Competitors	30.12%	5.04%	3.14%

Institutional and Insider Ownership

70.8% of Realty Income shares are owned by institutional investors. Comparatively, 59.3% of shares of all “Retail REITs” companies are owned by institutional investors. 0.1% of Realty Income shares are owned by insiders. Comparatively, 11.5% of shares of all “Retail REITs” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Realty Income rivals beat Realty Income on 8 of the 15 factors compared.

Realty Income Company Profile

Realty Income Corporation is a real estate investment trust (REIT) that owns and manages commercial properties leased to businesses. Its portfolio includes retail, industrial, gaming, and other properties, typically leased under long-term net lease agreements in which tenants are responsible for many property operating expenses. Founded in 1969, Realty Income is known as “The Monthly Dividend Company” for its monthly dividend payments. The company serves tenants across the United States and has expanded its property portfolio into Europe.