1 Magnificent High-Yield Dividend Stock Down 29% to Buy and Hold Forever

Core Viewpoint - The S&P 500 is nearing an all-time high, but the real estate sector has significantly underperformed due to high-interest rates, creating opportunities for long-term investors in real estate investment trusts (REITs) like Realty Income [1][2]. Company Overview - Realty Income is a REIT that specializes in net-leased properties, owning approximately 15,500 properties, with about 80% occupied by retail tenants [3][4]. - The company has begun expanding into data centers in partnership with Digital Realty Trust [4]. Business Performance - Realty Income's stock price is about 30% lower than its peak in early 2020, yet the business has shown strong performance, generating $1.05 per share in adjusted funds from operations (AFFO) in the most recent quarter [5][6]. - In comparison, the adjusted FFO was$0.83 per share in the same quarter of 2019, with a portfolio occupancy rate of 98.3% [7]. Market Opportunities - The net lease real estate market in the U.S. for Realty Income's property types is estimated at $5.4 trillion, with less than 4% owned by public REITs, indicating significant growth potential [8]. - Realty Income has delivered 14.1% annualized total returns since 1994, outperforming the S&P 500, and has a strong track record of consistent dividend increases [9]. Investment Potential - Realty Income's current dividend yield is approximately 5.7%, historically a favorable entry point for long-term investors, with past yields around 6% leading to annualized returns of over 17% [10][11].