Recent Buy: Realty Income Corporation

ID-100426334-300x300 Recent Buy: Realty Income CorporationI added more shares to my portfolio with the purchase of Realty Income Corporation (O)

24 shares @ $49.06 on 2/7/2018.

This increases my forward 12-month dividend income by $63.36 to a total of $4,968.38

I also updated my portfolio page to reflect the change.

 

 

My Thoughts

This company was the very first company I have ever bought in my dividend growth history. It was on June 30, 2013, when I bought 22 shares @ $44.45. Since that time the company has been on an upward trend. Until recently, the company has seen its price drop from a high of $71.47 on July 29, 2016, to as low as $47.41 just a few days ago.

I was very excited to see that the price per share was only a few dollars away from my cost basis. Lucky I was able to buy more share of this great company. Since my first buy, the company has been paying out a dividend every month and has a 3-year dividend growth rate of 6%. CFRA has a 3-year projected earnings growth of 4% for the company. So I expect the same kind of dividend growth like the most recent increase of 3.06%.

Currently, the company has a payout ratio of 83% with a current dividend yield of 5.3%. So it is safe to assume that the dividend is well covered.

“It’s far better to buy a wonderful company at a fair price, than a fair company at a wonderful price.” – Warren Buffett.

O is undervalued, and I recommend it a BUY at this time. I have a fair price of $53.11 which means that O is 6.3% undervalued based on today’s price of $49.96 (2-19-2018).

Even though the company is not substantially undervalued, I find it a great opportunity to buy shares of it right now. If it continues to hover in this price range, I do plan on buying more shares.

Screen-Shot-2018-02-19-at-2.13.50-PM Recent Buy: Realty Income CorporationSource: fastgraphs.com

 

What do you think of O? Plan on buying? or why not?

 

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Comments

  1. O is one of my favorite stocks. I recently added shares and plan to add more in the coming weeks. The other day I wondered if there is a stock that Felix would consider a buy right now (since most, if not all, of your recent stock reviews have been “holds”). Now I know. Are there other stocks that you’re buying or considering buying? REITs and utilities have fallen recently and represent good value.

    Enjoy following your dividend journey, or should I say Fiscal Voyage, and your YouTube videos. Take care.

    • Thanks Andrew!! There is a few other company that I will be buying in the coming months. OMI, KMB, WBA, CVS, HBI, and WPC. What do you think of that list?

      • Hi Felix, I own KMB and WPC, considering CVS….but still adding to O at these prices.

        Planning any trips this year?

        • Hi Andrew, I think my next buy will be KMB. It is fairly valued to slightly undervalued. I do plan to add to WPC and CVS in the near future as well.
          Thank you for asking. Yes, I have a big trip plan at the end of may I will be going to Europe again for two weeks. I will be posting about that soon!!

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