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It's Not Rocket Science, STAG Is Hitting All Cylinders


  • I am seeing more and more articles written on high-yielding REITs that offer no promise of dividend growth.
  • It’s almost as if the readers are being mesmerized by the double-digit returns with no warning that growth is not sustainable.
  • Today, I am going to provide a textbook example of one of my top Durable Income Portfolio picks using the dividend barometer methodology.

Recently, I was speaking with a friend of mine about the volatility in the retail REIT sector, and he was explaining that he decided to sell shares in Tanger Factory Outlet Centers (SKT). As I explained to him, and also in an article yesterday:

“Only you can decide if the glass is half-empty or half-full. Investors must have an obligation to themselves to thoroughly analyze the underlying business and its prospects before purchasing a stock.”

One of the best ways for me to select the winners is to study dividend performance. When I see a company like Tanger increasing its dividend on a consistent basis, it provides a signal that earnings can be relied upon and that management is committed to growing the dividend.

Given the selloff in the REIT sector, I am seeing more and more articles written on high-yielding REITs that offer no promise of dividend growth. It’s almost as if the readers are being mesmerized by the double-digit returns with no warning that growth is not sustainable. As Josh Peters, author of The Ultimate Dividend Playbook, explains:

“A dividend payment is the ultimate sign of corporate strength... I take dividend increases as the loudest and clearest message that management can send.”

Dividend growth is not the only way to find the best REITs to own, but a dividend record can offer valuable clues, just as valuable as earnings reports and much more valuable than market timing.

In fact, one of the reasons that my Durable Income Portfolio has generated strong returns since inception (May 2013) is because I have weighted the picks based on the strength of the underlying dividend. I have found that dividend growth is one of the absolute best barometers for total return performance, as it simply blows away the performance of the “sucker yield” pickers.

This article was written by

Brad Thomas profile picture
Leader of iREIT on Alpha
The #1 Service For Safe and Reliable REIT Income

Brad Thomas is the CEO of Wide Moat Research ("WMR"), a subscription-based publisher of financial information, serving over 100,000 investors around the world. WMR has a team of experienced multi-disciplined analysts covering all dividend categories, including REITs, MLPs, BDCs, and traditional C-Corps.

The WMR brands include: (1) iREIT on Alpha (Seeking Alpha), and (2) The Dividend Kings (Seeking Alpha), and (3) Wide Moat Research. He is also the editor of The Forbes Real Estate Investor

Thomas has also been featured in Barron's, Forbes Magazine, Kiplinger’s, US News & World Report, Money, NPR, Institutional Investor, GlobeStreet, CNN, Newsmax, and Fox. 

He is the #1 contributing analyst on Seeking Alpha in 2014, 2015, 2016, 2017, 2018, 2019, 2020, 2021, and 2022 (based on page views) and has over 108,000 followers (on Seeking Alpha). Thomas is also the author of The Intelligent REIT Investor Guide (Wiley) and is writing a new book, REITs For Dummies. 

Thomas received a Bachelor of Science degree in Business/Economics from Presbyterian College and he is married with 5 wonderful kids. He has over 30 years of real estate investing experience and is one of the most prolific writers on Seeking Alpha. To learn more about Brad visit HERE.

Analyst’s Disclosure: I am/we are long ACC, AVB, BHR, BRX, BXMT, CCI, CHCT, CIO, CLDT, CONE, CORR, CTRE, CUBE, DEA, DLR, DOC, EPR, EXR, FRT, GEO, GMRE, GPT, HASI, HT, HTA, INN, IRET, IRM, JCAP, KIM, KRG, LADR, LAND, LMRK, LTC, MNR, NNN, NXRT, O, OFC, OHI, OUT, PEB, PEI, PK, PSB, QTS, REG, RHP, ROIC, SBRA, SKT, SPG, STAG, STOR, TCO, TRTX, UBA, UMH, UNIT, VER, VNQ, VTR, WPC. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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