The Smartest Dividend Growth Stocks to Buy With $500 Right Now

REITs Overview - REITs have been out of favor on Wall Street due to interest rate volatility, but the current downturn could present opportunities for dividend growth investors [1] - Three REITs worth considering are W P Carey, Agree Realty, and Vici Properties [2] W P Carey - W P Carey cut its dividend at the start of 2024, resetting it after 24 consecutive years of annual increases, due to exiting the office sector which accounted for 16% of rents [3] - The company has increased the dividend every quarter since the cut, following the same pattern as before, and is now focused on stronger-performing industrial and retail sectors [4] - W P Carey offers a 6 5% dividend yield, significantly higher than the REIT average of 3 7%, making it a low-risk turnaround play [5] Agree Realty - Agree Realty cut its dividend in 2011 after a large tenant bankruptcy but has since grown to nearly 2,300 properties by Q3 2024, acquiring 144 properties in the first nine months of 2024 [6] - The dividend has grown at a compound annual rate of 6% over the past decade, with a current yield of 4 3%, well above the REIT average [7] - The company has shifted focus to financially strong tenants, moving away from Walgreens Boots Alliance and expanding relationships with growing retailers like TJX and Tractor Supply [8] Vici Properties - Vici Properties, focused on casinos, proved resilient during the COVID-19 pandemic, with tenants continuing to pay rent despite government shutdowns [9] - The REIT has increased its dividend each year since 2018, with a current yield of 6% and a compound annual growth rate of 7%, more than three times the net lease average [10] - Vici faces concentration risk with casinos making up nearly all of its rent roll and two tenants accounting for nearly three-quarters of the total, but it is looking to expand beyond casinos [11] Conclusion - The REIT sector, currently out of favor, offers opportunities for dividend growth investors, with W P Carey as a turnaround option, Agree Realty for growth and income, and Vici Properties as a contrarian play [12]