W.P. Carey: A Dividends Stock Worth Considering and Why

W.P. Carey is facing pressure, dropping 40% since 2019, partly due to a recent dividend cut. However, with a solid 6.6% yield and investments in lucrative industrial properties, it may still offer appealing returns for income-seeking investors.

Date: 15-01-2025

AI Rating: 6

Earnings Per Share (EPS): The report provides an insight into W.P. Carey's adjusted funds from operations (FFO), a proxy for earnings, which reached $1.18 per share during the third quarter of 2024, indicating a modest performance. This was only 12% less than the year prior.

Dividend and Payout: The company did not slash its dividend drastically but instead reduced it by 19.7% to $0.86 per share. However, it has moved to raise its payout four times in 2024 to $0.88 per share, signaling potential future stability in dividends.

Investment in Growth: W.P. Carey is seeking to improve its FFO by investing $1.6 billion in primarily single-tenant warehouse and industrial properties, likely contributing to its future income.

The report reflects that markets are cautious due to sharp increases in Treasury yields, making dividend stocks less attractive. However, W.P. Carey still delivered a decent FFO that is sufficient to support dividend increases.

Expectations Moving Forward: Investors are urged to see the long-term potential of the company coupled with the performance of REITs which are typically volatile. As the market continues to evolve, W.P. Carey appears to be positioning itself well for future dividend stability and growth.

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