Realty Income: A Prime Investment Opportunity

Realty Income is a good investment opportunity, with the author suggesting it is the best time to buy in the past 10 years. The article compares Realty Income to Simon Property and states that Realty Income is a better investment after a U.S. credit rating downgrade. The author recommends buying Realty Income stock.

Realty Income (O) has emerged as a compelling investment opportunity, especially in the current economic climate. With the U.S. credit rating downgrade, investors are seeking stable, income-generating assets. This article evaluates Realty Income's performance and compares it to Simon Property Group (SPG) to determine if it is a better investment option.

Realty Income's Strengths

Realty Income, often referred to as the "Monthly Dividend Company," is a prominent real estate investment trust (REIT) known for its consistent dividend payments and a stable portfolio of revenue-generating properties. As of July 2025, Realty Income stands out as a reliable dividend investment option, offering a 5.7% dividend yield and a history of increasing dividends for over 30 consecutive years [1].

The company's business model, which relies on net lease agreements with long-term tenants, ensures a stable income flow. Over the past three decades, Realty Income has outperformed the S&P 500 index, demonstrating its ability to generate strong returns [2]. Realty Income's portfolio includes approximately 15,600 properties, with a significant portion of its revenue coming from retail tenants.

Comparison with Simon Property Group

Simon Property Group (SPG) is another major REIT, known for its focus on retail properties. However, a comparison of the two reveals that Realty Income has several advantages.

1. Dividend History: Realty Income has a more consistent track record of increasing dividends. As of July 2025, Realty Income has increased its dividend for 111 consecutive quarters, while Simon Property Group has a less impressive track record [3].

2. Market Position: Realty Income is the net lease leader with a market cap of around $50 billion, roughly three to four times the size of its next closest net lease peers. This size advantage allows Realty Income to access capital markets more easily and act as an industry consolidator [3].

3. Portfolio Diversification: Realty Income's portfolio is more diversified, including exposure to industrial assets and properties in both North America and Europe. This diversification helps mitigate risks associated with sector-specific downturns [3].

Conclusion

Given the U.S. credit rating downgrade and the current economic environment, Realty Income presents a compelling investment opportunity. Its strong dividend history, stable income flow, and diversified portfolio make it an attractive choice for income-focused investors. While Simon Property Group is also a solid investment, Realty Income's advantages in dividend consistency, market position, and portfolio diversification make it a better investment option in the current market conditions.

References

[1] https://www.ainvest.com/news/realty-income-buy-hold-avoid-2507/
[2] https://www.fool.com/investing/2025/07/24/could-buying-realty-income-stock-today-set-you-up/
[3] https://www.fool.com/investing/2025/07/27/3-reasons-to-buy-realty-income-stock-like-theres-n/