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2 Millionaire Money-Maker REITs

May 06, 2021 7:00 AM ETO, OHI58 Comments


  • There are plenty of millionaire-making tactics out there worth following.
  • That’s why there’s a whole entire book about it: The Millionaire Next Door.
  • It’s one of my favorite books of all times – even though, when I read it the first time, I didn’t take it to heart the way I should have.
  • Lesson learned since then though.
  • Looking for a helping hand in the market? Members of iREIT on Alpha get exclusive ideas and guidance to navigate any climate. Learn More »
Money success concept. 100 dollar bills in businessman jacket pocket. Symbol of success and wealth
Photo by Velishchuk/iStock via Getty Images

When was the last time I did a piece about The Millionaire Next Door?

A strong argument could be made for Feb. 12, 2021, with the article, “A Millionaire State of Mind: Part 2.” Obviously then, there was therefore a

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This article was written by

Brad Thomas profile picture

Brad Thomas has over 30 years of real estate investing experience and has acquired, developed, or brokered over $1B in commercial real estate transactions. He has been featured in Barron's, Bloomberg, Fox Business, and many other media outlets. He's the author of four books, including the latest, REITs For Dummies.

Brad, with his team of 10 analysts, runs the investing group iREIT® on Alpha, which covers REITs, BDCs, MLPs, Preferreds, and other income-oriented alternatives. The team of analysts has a combined 100+ years of experience and includes a former hedge fund manager, due diligence officer, portfolio manager, PhD, military veteran, and advisor to a former U.S. President. Learn more

Analyst’s Disclosure: I am/we are long O, OHI. 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.

Note: Brad Thomas is a Wall Street writer, which means he's not always right with his predictions or recommendations. Since that also applies to his grammar, please excuse any typos you may find. Also, this article is free: written and distributed only to assist in research while providing a forum for second-level thinking.

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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Comments (58)

Brad Thomas profile picture
Brad's Saturday Update: The 'Big Air' Edition

Brad Thomas profile picture
We Bought Broadmark On The Pullback

title '' 2 millionaire making etc etc '' do we reallyneed this on a legitimate forum..................i say not ...................its called credibility
Brad Thomas profile picture
The Inside Scoop On "The Monthly Dividend Company"

konihug profile picture
Incidentally my two largest REIT holdings for more than eight years - thanks to recommendations by - you guess who. Thank you, @Brad Thomas
As a Swiss investor calculating in Swiss Francs, I always have to fight against a depreciating dollars, or at least consider this fact. Even then, my holdings have done very well. Sometimes I added, sometimes I sold some shares. Mostly, looking back, I sold too many shares, though always at a profit.
On the shares that I now own, I have a yield on cost of O: 6.1%, OHI: 9.1%. The entire yearly performance result as (in Francs) O; 7:1%, OHI: 7.5%. This is factoring in the USD/CHF price development over the years and the 35% withholding tax on dividends from the Swiss government.
Not spectacular, but always a joy to look at.
Currently, my yearly dividend income stream is more than 5000 USD from these two companies, so, certainly this is a nice contribution to my retired life each and every month.
Luca Stein profile picture
@Brad Thomas ist ja schön dass du auch Deutsch kannst :)
Brad Thomas profile picture
@Luca Stein Meine Großmutter kam aus Deutschland
It is a Top profile picture
Did you read his second book?
Brad Thomas profile picture
@It is a Top My 2nd book is being published in ~30 days and you get a FREE copy when you subscribe to iREIT on Alpha .... come join us :)

All the best - Brad
It is a Top profile picture
@Brad Thomas
Great, but did you read his follow up the millionaire mind?
superartus profile picture
Always love your articles.
Brad Thomas profile picture
@superartus Thank you!

Come join us at iREIT on Alpha....

Getting ready to publish interview (video and transcript) with O's CEO, Sumit Roy....

All the best!
I am still long OHI. Wish I was still long O. Both are great dividend payers.
Brad Thomas profile picture
@danot 1 out of 2 aint bad ;)

Come check us out at iREIT on Alpha....
Viking Investments profile picture
@Brad Thomas Hello Brad, good article. Do you look at same store growth metrics? Do you have the industry average for the metrics you review?
Brad Thomas profile picture
@Viking Investments Yes and Yes. Come visit us at iREIT on Alpha...we have access to research terminals and can obtain most anything.... All the best. Thank you
JBTCP profile picture
Brad, thanks for this article. In my view, there are very few "cheap" REITs out there today, or better said, very few quality cheap REITs. The only one in my view is DEA. What are your thoughts on DEA at current levels?
Brad Thomas profile picture
@JBTCP We just wrote on DEA post Q1 earnings (for iREIT members)... Biggest risk is upcoming lease maturities. Modest growth but we treat this one more like a government bond that grows by 3-4% per year.... pretty boring...but very predictable. We maintain a BUY....

Come visit us at iREIT on Alpha - All the best. Brad

PS - iREIT members get a free copy of my new book (pub July 2021)
JBTCP profile picture
@Brad Thomas Thanks. And I agree, DEA certainly won't give you home run returns, but it will give you steady 7-10% return annum between the dividend and appreciation.
JBTCP profile picture
Quick follow-up...can you post a link to the write-up you mentioned you did on DEA? I couldn't find it, and would be interested in giving it a read. Thanks.
Hi Brad,
Thanks for the update. Been long OHI for a few years. Div, are great. Reinvest all the way. Off subject here, picked up some HASI today at 46.45. Have owned since the teens. Any thoughts of HASI at this level? Close to that 3% level thought i would add.
Thanks for your comments on O and OHI. I have been buying them over the past four years twenty shares at a time now adding up to 300 shares each (based on your recommendations). On REITS I go for the marathon approach and now placing dividends into savings for the next downturn. I like them better at 50 and 30 to add more.
Brad Thomas profile picture
@Davidsan3639 I'm sticking with quality .... that's why our portfolio returns are strong. Come visit us at iREIT on Alpha:https: //seekingalpha.com/author/brad-thomas/research

All the best - Brad
ChuckXX profile picture
Brad; Why are you projecting a "DIVIDEND CUT" from 23 to 24???? I ask everyone out there that are Long Term Investors to pull up a "5 YEAR CHART" on OHI. It speaks for itself. I was pretty excited about maybe buying a healthy chunk of it this morning until I pulled up that 5 year chart. Just as an example on August 26, 2016 the stock price was $36.12. Now there will be the Attack Squad that comes out and says oh anybody can cherry pick a date in time. TRUE. But my point is this does not appear to be a stock that is going to give you much if any capital appreciation. It appears to be strictly a dividend animal. Which is fine but people need to be aware of that.
Brad Thomas profile picture
@ChuckXX where did you see dividend cut? that Fast Graph is a long term analyst opinion. All the best

PS - I discussed the dividend policy at length with the CEO yesterday on our video: seekingalpha.com/...
ChuckXX profile picture
@Brad Thomas Hi Brad; Its in the forecasting calculator chart Brad. If you look at 23 & 24 you will see it going from $2.80 to $2.77. By the way you are one of my most favorite writers/analysts on this site bar none. You & Steven Fiorillo are by far Head & Shoulders above the rest by a very wide margin.
JMS89 profile picture
It's been a gift this year to acquire O at these levels. One of my favorite retirement plays. Plan to drip O until im 6 feet under.
Brad Thomas profile picture
@JMS89 Nice job!

Come visit us at iREIT on Alpha...
Always a great read, Brad. If I would just follow your advice (and there is alot of it out there) I would already be retired.
Brad Thomas profile picture
@CynicalTexanInvestor Thank you!

I just interviewed CEOs at OHI and O yesterday.... both were terrific interviews, reinforcing our Buy thesis... please come visit us at iREIT on Alpha.... we are growing the service like a weed....

AND... all of our members get a FREE copy of my new book, The Intelligent REIT Investor, endorsed my no other than Sam Zell,

“The simple genius of public REITs is that they turn bricks and mortar into transparent and predictable liquid assets. Since they tend to pay high dividends, REITs can serve as a terrific addition to an investment portfolio. Thomas’ book helps break down this asset class for the average person, making REITs more understandable, and therefore more accessible, to everyone.”

Have a great day and all the best - Brad
Douglas Payne profile picture
Prof. Thomas.. GREAT LIFE COURSE FOR ALL OF US. I thank you again for putting Life Lesson Plans on our plate.. SOME MEALS REQUIRE SECOND AND THIRD HELPINGS~ This is why I sincerely believe that iREI Service For Safe and Reliable REIT Income needs retelling for all of us.. ALL THE TIME~!!
Brad Thomas profile picture
@Douglas Payne Thank you!!!

I can't wait to send you and all of the members at iREIT on Alpha a copy of my new book! Getting closer and closer....

All the best - Brad
Douglas Payne profile picture
@Brad Thomas .. Your new book? "BRING IT ON"~! Thank you Mr. Thomas.
Brad Thomas profile picture
@Douglas Payne I can't wait for you to have it! All the best
Russell A profile picture
OHI's cost of capital is 6.3%? Why so high?
Brad Thomas profile picture
@Russella1221 We are putting together a debt and cost of capital tool - as requested by our members at iREIT on Alpha. The WACC is a function of the debt cost (a tad higher due to the PEAK acquisition) and equity pricing (FFO yield is 9.2%). Come join iREIT on Alpha and get a free copy of my new book - The Intelligent REIT Investor.

All the best - Brad
RoseNose profile picture
Thanks for the information about OHI. I recently went back to it with high hopes for it to continue to provide a quality safe dividend. The recent price decline means I can add more. I like O too and continue to watch, but bought NNN first and also WPC. Maybe one day soon I will succumb. Have a great week and Happy Investing :)) Rose
Brad Thomas profile picture
@RoseNose Thank you for reading & commenting.... I hope you enjoy the two CEO interviews at iREIT on Alpha.... we published the OHI iterview last night and the O interview goes up this am...

Have a great day and thank you for being a loyal member at iREIT on Alpha...

Here is your latest article (A+): seekingalpha.com/...
RoseNose profile picture
@Brad Thomas - Oh I will watch those. Appreciate the link and especially all your continued pertinent timely articles! Best always :)) Rose
Own them both & have done well. Just started buying more OHI. Again.
Brad Thomas profile picture
@G. Blair Bauer Thanks for reading! Good luck and all the best
@Brad Thomas ,You and Dividend Sensei got me into both of these. Thank you.(WPC & IRM,too)
Brad Thomas profile picture
@G. Blair Bauer Thanks for the feedback - all the best!
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