3 Top Real Estate Stocks to Buy in September

Trying to beat the bears in this market is not easy, but there are a few options to consider that have held up well and show promise as the market recovers.

Dividend stocks are a good place to look, as are real estate stocks. Combine the two and you have real estate investment trusts (REITs), which own pools of rental properties and are required to pay out at least 90% of their taxable income in the form of dividends.

Although there are more than 200 publicly traded REITs, three that might be worth buying this month are retail rental companies Agree real estate (ADC -2.68%)Specialist in car service GettyRealty (GTY -1.41%)and casino owners VICI properties (VICI -1.67%).

The chart shows the one-year total returns of Getty Realty, Agree Realty, and VICI Properties, outperforming the S&P 500 and the Vanguard Real Estate ETF.

GTY Total Return Level data from YCharts

As the chart above shows, each of these REITs is still in the green on one-year total returns, and significantly outperforms both REITs S&P500 and scale Vanguard real estate ETFan exchange-traded fund that holds about 160 individual REITs.

Here’s more on each.

1. Real estate agree

Agree Realty owns more than 1,600 properties in 48 states and has an enviable record for both shareholder returns and dividend growth. Since its IPO in 1994, the company has produced a compound annual return of 12.7%, while its dividend has grown 5.5% annualized over the past 10 years.


A portfolio two-thirds owned by premium retailers (Walmart is the highest renting tenant) and a strong balance sheet allow the company to expand rapidly. Agree added 228 properties in the first half of 2022 and plans to end the year with $1.5 billion to $1.7 billion in new investments in buildings and in its growing land leasing business to developers.

The market likes this stock. Agree shares now trade for about $71, which is pretty much flat so far this year, while the 3.9% dividend yield means investors are still afloat. Analysts give it a moderate buy rating with a target price of $79.86.

2. Getty Real Estate

Like Agree, Getty Realty is a retail REIT, but much more specialized. The portfolio consisted of 1,024 properties in 38 states in the second quarter of 2022, primarily gas stations, convenience stores, auto parts stores and car washes.

“We invest in freestanding, single-tenant properties where consumers spend money on their car or on their car,” Getty says of his business, and it’s worked out well. The real estate company, owned by Getty Petroleum, has significantly outperformed the S&P 500 in total returns since it spun off in 1997 when its parent company was sold to Russia Lukoil.

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Getty Realty is also expanding its portfolio, contributing to its ability to continue a record nine years of dividend increases, which has a current yield of about 5.5%. A payout ratio of a relatively modest 71% based on cash flow also contributes to this REIT’s stability as a driver of passive income and total returns.

3. VICI properties

VICI Properties is not like the other two on this list. This REIT owns more than 122 million square feet of casinos and other entertainment and hospitality destinations. Among the 43 tenants are such Las Vegas marquee establishments as Caesars Palace, the MGM Grand and the Venetian.

Created as a spin-off from Caesar’s entertainment, it owns properties with 19,200 hotel rooms, more than 450 restaurants, bars, clubs and sports book and four championship golf courses. The company has increased its dividend every year since going public in 2018, even during the worst of the pandemic.

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VICI Properties’ stock is up a market-breaking 9.5% year-to-date and is yielding about 4.7% at a share price of about $33. Analysts rate it a “buy” with a consensus target of $36.45. An 80% payout ratio based on cash flow and the popularity of its US locations increase the likelihood of continued solid performance.

Recession, inflation resistance help recommend these stocks as a buy-and-hold

I already own and plan to increase my holdings in Getty Realty and Agree Realty, and am also now considering VICI Properties. Each of these companies has held up well during the pandemic and has what it takes to turn a profit even through inflation and recession. This makes them good buys to consider this month and in the future.

Marc Rapport has positions in Agree Realty, Getty Realty and Vanguard Real Estate ETF. The Motley Fool has positions in and recommends Vanguard Real Estate ETF and Walmart Inc. The Motley Fool recommends VICI Properties Inc. The Motley Fool has a disclosure policy.

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