Real Estate Investment Trusts, better known as REITs, are companies that own, operate, or finance income-producing real estate across a range of property sectors. These can include sectors like residential, commercial, industrial, and even more specific niches like data centers or healthcare facilities. By law, REITs must distribute at least 90% of their taxable income as dividends to shareholders. This makes them an attractive option for income-focused investors. They provide a unique way for individual investors to benefit from real estate investments without the need to directly own properties.
Investing in REIT stocks can be similar to investing in any other type of stock. REITs are publicly traded on major stock exchanges. So investors can buy and sell them just like they would shares of a tech company or a consumer goods manufacturer. One of the significant benefits of investing in REIT stocks is the potential for both capital appreciation and income. While property values may rise, leading to an increase in the stock price, REITs also provide regular income through their dividend payouts.
However, investing in REIT stocks is not without risks. The performance of REITs is tied to the real estate market, which can be cyclical and influenced by a number of factors including economic conditions, interest rates, and location-specific issues. Investors need to understand these risks and consider their own risk tolerance and investment goals when investing in REITs. As with all investments, a well-diversified portfolio is generally recommended, and REITs can certainly play a part in that, offering exposure to real estate while still providing the liquidity of stocks. On that note, here are two REIT stocks to check out in the stock market today.
REIT Stocks To Buy [Or Sell] Now
American Tower Corp (AMT Stock)
To start, American Tower (AMT) is a leading REIT that owns, operates, and develops multi-tenant communications real estate. Particularly cellphone towers. As the demand for data and 5G technology grows, so too does the necessity for the infrastructure that American Tower provides.
Last week, American Tower Corp announced its second quarter of 2023 financial results. In the report, the company posted Q2 2023 earnings of $2.46 per share, with revenue of $2.77 billion. This is better than analysts’ estimates which were earnings of $2.27 per share on revenue of $2.73 billion. Additionally, revenue grew by 3.64% compared to the same period, the previous year.
Year-to-date, shares of AMT stock have pulled back by 11.19%. Meanwhile, during Monday’s lunchtime trading session, American Tower Corp stock is trading modestly higher by 0.81% at $190.55 a share.
Prologis Inc. (PLD Stock)
Next, Prologis, Inc. (PLD) is a global leader in logistics real estate. The company operates a portfolio of high-quality assets in the most vibrant centers of global commerce. They are known for their investment in industrial properties, especially warehouses and distribution centers.
Earlier this month, Prologis also reported its second quarter 2023 financial results. Diving in, the company announced earnings of $1.83 per share, on revenue of $2.45 billion. This came in higher than Wall Street’s consensus estimates which were an EPS of $1.68, with revenue estimates of $1.69 billion. Moreover, revenue increased by a whopping 95.75% on a year-over-year basis.
In 2023 so far, shares of PLD stock have increased by 10.64% year-to-date. While, during Monday’s early afternoon trading session, PLD stock is trading up by 0.83% on the day at $124.68 a share.