7 Highest-Yielding 'Strong Buy' REITs Offer Huge Dividends and Inflation Protection

There is an adage among real estate investors that says you cannot make or create any more land. While you can always build higher, you still need the land. One of the best assets that most investors are underweighted on is real estate. Those who own a home are technically real estate investors, but homeownership does not produce any income, unless you have rental homes, which can be very capital intensive, not to mention time-consuming.

The inflation conditions this year are the worst since the early 1980s, and there is no reason to expect things will improve any time soon. In fact, according to the National Federation of Independent Business, about 40% of U.S. small businesses intend to raise prices by 10% or more this year. Add in spiraling food and gasoline prices, and the picture for the rest of 2022 looks increasingly grim.

Real estate investment trusts (REITs) can act as a hedge against inflation by capitalizing on cheap mortgage interest rates, passing through rising costs to commercial or residential tenants with higher rent prices, and benefiting from rising values over the long term. Most of the top companies in the business have secured cheap capital, and even though rates are headed higher this year, the Federal Reserve’s target of 3.0% to 3.5% for federal funds is still low on a historical basis.

We screened our 24/7 Wall St. REIT research universe and found seven top stocks that are all Buy-rated on Wall Street and pay very secure and big dividends. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Gladstone Commercial

This stock has been hit hard as interest rates charged higher and is offering the best entry point since last November. Gladstone Commercial Corp. (NASDAQ: GOOD) is focused on acquiring, owning and operating net leased industrial and office properties across the United States.

As of June 30, 2021, Gladstone owns a diversified portfolio of 121 office and industrial properties located in 27 states and leased to 106 tenants. The company has grown the portfolio in a consistent, disciplined manner at a rate of 18% per year since going public in 2003. It matches long-term leased properties with long-term debt to lock in the spread to create a durable, stable cash flow stream to fund monthly distributions to shareholders. Current occupancy stands at 96.5%, and that occupancy has never dipped below 95.0% since 2003.

Most importantly for investors, Gladstone has a track record of success, as exhibited by a history of strong distribution yields, consistent occupancy and more than 10 years of paying continuous monthly cash distributions.

Investors receive a rich 7.01% distribution. Aegis has a Wall Street high $26 price target, which may be headed higher soon. The consensus target for Gladstone Commercial stock is $25. The last trade for Tuesday was at $21.46 a share.

Sponsored: Tips for Investing

A financial advisor can help you understand the advantages and disadvantages of investment properties. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Investing in real estate can diversify your portfolio. But expanding your horizons may add additional costs. If you’re an investor looking to minimize expenses, consider checking out online brokerages. They often offer low investment fees, helping you maximize your profit.