Realty Income is an interesting company for a couple of reasons: the starting yield is usually high, with investors throughout much of its publicly traded life being able to establish a position with an initial yield of at least 5%. The dividend grows each year, which is an unusual characteristic once you leave the tobacco, telecom, and oil industries (although real estate can be a close fourth). And the dividends get paid out monthly, giving you the ability to instantly compound because your dividend income immediately buys new shares every month that then start paying out dividends all of their own.
As you can imagine, those factors combine together to produce pretty amazing results when you choose to reinvest your dividends back into the REIT.
First, let’s look at what Realty Income’s are returns are when you just add up the share price appreciation and the dividends paid out over … Read the rest of this article!