7 REITs With Fat Dividends to Grab Now as Rates and Inflation Rise

If you thought June was rough from an interest rate standpoint, July may be just as bad, as some of the Federal Reserve governors now are starting to hint that another 75-basis-point increase to the federal funds rate could be in order. As we have noted before, the old saying of “Don’t fight the Fed” works both ways. There is a good chance the central bank will continue to raise rates until the spiraling inflation starts to calm down.

One asset class that tends to survive rate increases and inflationary times is real estate investment trusts, or REITs. As overall costs rise, so do rents and leases that REITs hold. In fact, during a recent rate-hiking cycle, REITs outperformed the S&P 500 by more than double. In addition, rising rates are forcing some potential homebuyers to remain in rentals, whether it be houses or apartments.

We screened our 24/7 Wall St. REIT research database looking for solid ideas that also pay large and dependable dividends. While all seven stocks we uncovered are rated Buy at major Wall Street firms, it is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Getty Realty

Despite climate change concerns, people still need gasoline for their cars, trucks and vans, and gas stations still provide that basic need. Getty Realty Corp. (NYSE: GTY) is a publicly traded, net lease REIT specializing in the acquisition, financing and development of convenience, automotive and other single-tenant retail real estate. As of March 31, 2022, the company’s portfolio included 1,014 properties in 38 states and the District of Columbia.

With big footprints in both Texas and California, the company serves some of the most populated regions of the country, and last week it posted strong first-quarter results wherein funds from operations surpassed Wall Street expectations.

Shareholders receive a 6.14% distribution. JMP Securities has a $32 target price on Getty Realty stock. The consensus target is $32.75, and the stock was last seen on Wednesday trading at $26.59.

Iron Mountain

Many businesses turn to this company to store data or documents. Iron Mountain Inc. (NYSE: IRM), founded in 1951, is the global leader in secure storage and information management services. Trusted by more than 225,000 organizations around the world, and with a real estate network of more than 90 million square feet across approximately 1,450 facilities in approximately 50 countries, Iron Mountain stores and protects billions of valued assets, including critical business information, highly sensitive data and cultural and historical artifacts.

Its solutions include secure records storage, information management, digital transformation and secure destruction, as well as data centers, cloud services and art storage and logistics. Iron Mountain helps customers lower cost and risk, comply with regulations, recover from disaster and enable a more digital way of working.

Shareholders receive a 5.03% dividend. Barclays recently started coverage on Iron Mountain stock and its price target is $58. That compares with a $55.42 consensus target and Wednesday’s close at $48.18.

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.