In this article, we presented 11 REIT dividend stocks with over 10% yield.
Dividend investing is continuing to take hold of the markets as the Federal Reserve is showing no intention to stop raising interest rates. Investors are looking for safe stocks that pay reliable dividends. And data shows that dividend investing has almost always paid off during difficult times. According to a report from Hartford Funds, reinvested dividend account for a whopping 84% of the total return of the S&P 500 Index since 1960.
This year hasn’t been kind to REITs. Rising inflation and interest rates have battered several REITs trading in the US and worldwide. However, not everything is bad when it comes to REITs when we compare their performance to other groups. According to its 2022 mid-year review report by NAREIT, REITs were leading the broader stock market in terms of returns through June this year.
Another kind of REITs is performing exceptionally well in 2022 — nontraded real-estate investment trusts. A WSJ report recently said that some of these REITs have returned as much as 10% this year. Nontraded REITs raise money from private investors and individuals through financial advisors. The WSJ report cited data from Robert A. Stanger & Co., an investment-banking firm that tracks the REIT market, according to which these REITs have raised a whopping $92 billion over the past five years.
Photo by Karolina Grabowska: https://www.pexels.com/photo/hands-holding-us-dollar-bills-4968630/
Our Methodology
In this article we picked some REIT dividend stocks with yields over 10% as of the end of October. You have to keep in mind that these high yields come at the expense of safety. These REIT dividend stocks aren’t as safe as other dividend stocks (see best safe dividend stocks for retirement portfolios), but they offer much higher upside potential.
REIT Dividend Stocks With Over 10% Yield
11. Arbor Realty Trust Inc (NYSE:ABR)
Arbor Realty Trust (NYSE:ABR) is a New York-based REIT that invests in a diversified portfolio of structured finance assets in the multifamily, single-family rental, and commercial real estate markets in the United States. Arbor Realty Trust is in the news after it beat Q3 estimates and also increased its dividend. Arbor Realty Trust posted an EPS of $0.56 for the third quarter, crushing the estimate of $0.36. Net interest income came in at $99.3 million, up from $94.3 million posted in the previous quarter.
Arbor Realty Trust has a dividend yield of over 10% as of November 5. As of the end of the second quarter of this year, 12 hedge funds tracked by Insider Monkey had stakes in the company. The total value of these stakes was about $75 million.
10. KKR Real Estate Finance Trust Inc (NYSE:KREF)
KKR Real Estate Finance Trust Inc (NYSE:KREF) is a mortgage real estate investment trust that focuses on origination and purchase of credit investments related to CRE, including leveraged and unleveraged commercial mortgage loans, and commercial mortgage-backed securities. KKR Real Estate Finance Trust Inc has a dividend yield of about 10% as of November 5. Last month, the stock fell after KKR Real Estate Finance Trust Inc swung to an attributable loss for the third quarter. Net income attributable to shareholders in the period totaled -$48.42 million, compared to $31.99 million posted in the same period last year.
Hedge fund sentiment for KKR Real Estate Finance Trust Inc remained unchanged in the second quarter, as 10 funds reported owning stakes in the company at the end of the period. The total value of these stakes was $28.4 million.
9. Chimera Investment Corporation (NYSE:CIM)
New York-based Chimera Investment Corporation (NYSE:CIM) is one of the top high-yield dividend companies. The stock has a dividend yield of over 13% as of November 1. Chimera Investment Corporation invests in residential mortgage loans, agency and non-agency residential mortgage-backed securities, agency mortgage-backed securities secured by pools of residential, commercial mortgage loans, and other real estate related securities. In September, Chimera Investment Corporation declared a dividend of $0.23 per share. This was a 30.3% decrease from its previous dividend of $0.33. The dividend was payable on October 31 to shareholders of record September 30. Despite cutting the dividend, the forward dividend yield at that time came in at about 12.17%
Chimera Investment Corporation stock gained in October along with several others REITs following a rally in the bond market.
Chimera Investment Corporation, however, has seen a sharp decline in hedge fund sentiment as of the end of the second quarter, as just 12 hedge funds had stakes in the company at the end of June, based on our database of 895 hedge funds. This was down from 21 hedge funds that reported having stakes in the company at the end of the first quarter.
8. Cherry Hill Mortgage Investment Corp. (NYSE:CHMI)
Cherry Hill Mortgage Investment Corp. (NYSE:CHMI) is another REIT that invests residential mortgage assets. As of November 1, the stock has a dividend yield of a whopping 19%. The company’s primary source of income is servicing interest mortgage loans. While analysts fear that the rising interest rates could hamper Cherry Hill Mortgage Investment Corp.’s growth targets, they believe the company could weather the current economic storm with its diversified portfolio and strong fundamentals. Cherry Hill Mortgage Investment Corp. is refining its RMBS portfolio and diversifying it with partnering with MSRs. This strategy could mitigate risks in the core business. In September, Cherry Hill Mortgage Investment Corp. announced its quarterly dividend of $0.27 per share, in line with the previous dividend. The dividend was payable on October 25 to shareholders of record September 30.
Just 4 hedge funds tracked by Insider Monkey had stakes in Cherry Hill Mortgage Investment Corp. as of the end of the second quarter. The total value of these stakes was about $8.2 million. The most notable stakeholder of the stock is Jim Simons’ Renaissance Technologies which owned a $5.4 million stake in the company at the end of June. Billionaire Izzy Englander also has a small stake worth $829,000 in the company.
7. Ellington Residential Mortgage REIT (NYSE:EARN)
Ellington Residential Mortgage REIT (NYSE:EARN) is a Connecticut-based REIT that invests in and manages residential mortgage-and real estate-related assets. Despite the macroeconomic volatility and harsh market conditions, the company is maintaining its high dividend, which it pays monthly. As of November 1, the company has a dividend yield of 14%. In October, Ellington Residential Mortgage REIT declared its monthly dividend of $0.08, in line with the previous. The dividend is payable on November 25 to shareholders of record as of October 31. Piper Sandler analyst Crispin Love in October decreased his price target on the stock to $8 from $9.50 and kept an Overweight rating on the shares. The analyst said that following the first half of the year which was extremely volatilite, the “volatility cooled and spreads tightened in July for mortgage real estate investment trusts.” However, the analyst said that the positive effect was temporary because volatility came back in both August and September.
A total of 5 hedge funds tracked by Insider Monkey had stakes in Ellington Residential Mortgage REIT as of the end of the second quarter. The total value of these stakes was $8.1 million.
6. Global Net Lease, Inc. (NYSE:GNL)
Global Net Lease, Inc. (NYSE:GNL) is a New York-based REIT that has a portfolio of commercial properties, with an emphasis on sale-leaseback transactions involving single tenant, mission critical income producing net-leased assets across the United States and Europe. Global Net Lease, Inc. has a dividend yield of about 13.1% as of November 1. Global Net Lease, Inc. came into the limelight after activist fund Blackwells Capital started a proxy fight to force the company to evaluate the possibility of selling itself, according to Reuters. The fund nominated two directors to the company board and also plans to nominate two more directors in 2024. Blackwells is trying to remove the outside manager of Global Net Lease, Inc.. Analysts believe that if Blackwells’ efforts are successful, GNL could continue paying its high dividends.
As of the end of the second quarter, 11 hedge funds tracked by Insider Monkey had stakes in Global Net Lease, Inc., compared to 9 funds in the previous quarter. The total value of these stakes was about $24 million. The biggest stakeholder of the company in our database was Ken Griffin’s Citadel Investment Group which had a $6.2 million stake in the company.
5. Invesco Mortgage Capital Inc. (NYSE:IVR)
Invesco Mortgage Capital has been in the news this year, but not for the good reasons, as its board cut the company’s dividend by 28% in September. The board announced a quarterly dividend of $0.65 per share, a major decline from its previous dividend of $0.91. However, despite the dividend cut, the company’s forward dividend yield came in at about 21. The dividend cut was not without a reason. The company’s management said that the cut would allow the company to “retain additional capital and further improve its capital structure.” The company also issued an update on its portfolio and liquidity, saying that its total investment portfolio as of the end of August was valued at $4.9 billion.
As of the end of the second quarter, 7 hedge funds in Insider Monkey’s database of 895 funds had a stake in the company, compared to 10 funds in the previous quarter. The total value of these stakes stood at about $28 million. The biggest stakeholder of the company at the end of June was Dmitry Balyasny’s Balyasny Asset Management, which had a $12.5 million stake in the company.
4. MFA Financial, Inc. (NYSE:MFA)
MFA Financial is a New York-based REIT that invests in residential mortgage assets, including non-agency mortgage-backed securities (MBS), agency MBS, and credit risk transfer securities. The stock has a dividend yield of about 17% as of November 1. The stock jumped in October after the company posted preliminary results for the third quarter. The company expected its book value per share in the quarter to come in at $15.25-$15.40, compared to $16.42 per share posted at the end of the second quarter.
As of the end of the second quarter, 15 hedge funds tracked by Insider Monkey had stakes in the company, compared to 16 funds in the previous quarter. The total value of these stakes was $153 million.
3. Ready Capital Corporation (NYSE:RC)
Ready Capital is a New York-based REIT that has a dividend stock of over 13% as of November 1. On September 15, the company announced a dividend of $0.42 per share, in line with the previous dividend. As of the end of the second quarter, 9 funds in the database of Insider Monkey had stakes in the company, compared to 11 funds in the previous quarter.
2. Redwood Trust, Inc. (NYSE:RWT)
Redwood Trust operates three segments: Residential Mortgage Banking, Business Purpose Mortgage Banking, and Investment Portfolio. The stock has a dividend yield of 12.8% as of November 1. Redwood Trust stock jumped last month after the company posted its Q3 results. Its Non-GAAP Earnings Available for Distribution (EAD) came in at $0.16 as compared to -$0.11 posted in the same quarter last year. Net interest income plummeted by 16.67% to reach $35 million.
As of the end of the second quarter, 14 hedge funds tracked by Insider Monkey had stakes in the company, compared to 16 funds in the previous quarter. The total value of these stakes was about $40 million. The biggest stakeholder in the company at the end of the June quarter was Phill Gross’ Adage Capital, which had a $13.3 million stake in the company.
1. Two Harbors Investment Corp. (NYSE:TWO)
Minnesota-based REIT Two Harbors Investment is one of the best REIT dividend stocks to buy today. The stock has a dividend yield of about 19% and a PE ratio of 1.43 as of November 1. In October, investment firm RBC Capital analyst Kenneth Lee lowered his price target on the stock to $4.50 from $5.50. However, the analyst kept an Outperform rating on the stock. The analyst said that he is cutting his full-year fiscal 2022 outlook on the company by 2 cents to 77 cents. He also cut his FY’23 guidance by 6 cents to 73 cents. The analyst said that he took into account the updated assumptions related to funding costs and asset yields based on the current market situation.
The latest market conditions are indeed taking a toll on the company. In October the stock dipped after the company announced preliminary third quarter numbers. As of the end of the second quarter, 30 hedge funds tracked by Insider Monkey had stakes in the company, compared to 31 funds in the previous quarter. This makes Two Harbors Investment one of the most popular high-dividend REIT stocks in our database of 895 elite hedge funds. The biggest stakeholder of the company as of the end of the June quarter was Ken Griffin’s Citadel Investment Group, which had a $15.2 million stake in the company.
Please take a look at 11 Best Dividend Aristocrats with 3+% Yield and 12 Best Reddit Stocks To Buy.
Follow Insider Monkey on Twitter
- Suggested articles:
This article is originally published at Insider Monkey.
