Interest Rate Hikes Almost Over: 7 Beaten-Down Contrarian REITs With Huge Monthly Dividends to Buy Now

It has been a long year of interest rate hikes, but with both the consumer price index and the producer price index numbers coming in better than expected this week, it is becoming clear that, while painful, the Federal Reserve’s rate hike campaign is working. The good news for investors is that though it is likely the Fed raises rates by 25 basis points again at the meeting in early May, that could be the end of this rate hike cycle. And note that the central bank could hold rates at 5.00% to 5.25% well into next year.

One great idea now, especially with the Fed closing in on the end of the rate hikes, is real estate investment trusts (REITs). These trusts are a practical way to own commercial and residential real estate, and many pay among the best dividends of any asset class. However most only pay out quarterly (four times a year), so there are at least 90 days between dividends. Since most Americans receive bills that need to be paid monthly, we decided to screen our 24/7 REIT research universe for Buy-rated stocks that pay monthly dividends. We found seven that make sense for income investors looking for dependable distributions and a degree of safety.

For contrarian investors, REITs now may be at the biggest discount in years after the year-long interest rate hikes. While selection is crucial, as the current bank issues could crimp lending, the top companies will survive and offer huge total return potential. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Agree Realty

This top REIT has had a nice run off the lows printed earlier this year and still has potential upside. Agree Realty Corp. (NYSE: ADC) focuses on the ownership, development, acquisition and management of retail properties net leased to national tenants. It specializes in acquiring and developing net-leased retail properties for retail tenants.

The company specializes in the acquisition and development of properties net leased to industry-leading, omnichannel retail tenants. As of December 31, 2022, it owned and operated a portfolio of 1,839 properties, located in all 48 continental states and containing approximately 38.1 million square feet of gross leasable area.

Investors receive a 4.36% distribution. Raymond James has a Strong Buy rating and an $81 target price objective on Agree Realty stock. The consensus target is $77.96, and the stock closed on Thursday at $66.36.

EPR Properties

This REIT invests in some of the most popular entertainment companies. EPR Properties Inc. (NYSE: EPR) is a leading experiential net lease REIT, specializing in select enduring experiential properties in the real estate industry.

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.