Investors Urged to Prefer Realty Income Over AGNC Investment

A recent report suggests that dividend investors should avoid AGNC Investment due to its unreliable income and potential dividend cuts, recommending Realty Income as a stronger, more stable investment alternative.

Date: 15-12-2024

AI Rating: 5

The report highlights the distinct investment profiles of AGNC Investment and Realty Income, emphasizing that AGNC's high yield of nearly 15% may not be sustainable or reliable for income-focused investors. AGNC Investment has provided respectable total returns over time, but it is stressed that those returns primarily benefit those who reinvest dividends rather than those needing consistent income. The declining dividends from AGNC indicate a cautionary perspective for income investors.

On the other hand, Realty Income appears as a beacon for dividend investors, boasting a 5.6% yield backed by a history of increasing dividends over 30 years. Realty Income's large portfolio of over 15,400 properties, coupled with its investment-grade-rated balance sheet, positions it as a reliable income-generating asset. The report points out that its structure minimizes risks related to individual properties and grants it better access to capital markets for growth.

From the investment angle, there's a clear distinction in risk and reliability between the two stocks. AGNC may be suitable for a niche group of investors, primarily those focusing on total return, but it poses a threat for those relying on consistent income, due to its historical dividend volatility.

Stocks: NASDAQ:AGNC NYSE:O