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moneymorning.com/wp-content/blogs.dir/1/files/2019/02/plant-growing-in-jar-of-coins-75×50.jpg 75w” sizes=”(max-width: 300px) 100vw, 300px” title=”REITs” />Forecasts for global economic growth are dropping dramatically. The United States is now seen as a safe haven island unto itself.
Now, investors are buying dollars, which has pushed yields on debt securities even lower.
These machinations have led investors to move to riskier high-yield investments, which has in turn lifted stocks significantly in the first two months of 2019.
Wall Street often has a crude sense of humor knowing that such “risk-on” trades may be coming at exactly the wrong time.
First, analysts are unclear about corporate earnings in 2019. They have no clue if there will be any meaningful growth in earnings.
We already know GDP will come in lower than a year prior.
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So how can it be that stock prices are going higher?
In some ways, it makes sense. There is no other place for capital to flow.
Investors interested in safer alternatives to buying stocks just as the economy is teetering should be looking at real estate investment trusts, or REITs.
REITs are even more attractive for investors looking for income.
Retail sales in December collapsed, pushing bond yields even lower.
The stars are aligning perfectly for investing in REITs, and the Money Morning Stock VQScore system just identified two that rank highly. Best of all, one pays a dividend yield of over 12%.
These are the two best REITs to buy today…
Best REITs to Buy Now, No. 2:
All the gyrations in the economy may be interpreted negatively in the near term, but REIT investors are more focused on the long term.
What matters most to the REIT investor is reliability of cash flow.
A stable cash flow is required to pay the dividends that make REITs so attractive today.
Sunstone Hotel Investors Inc. (NYSE: SHO) has investments in 22 hotels that operate under recognizable brands like Marriott, Hilton, and Hyatt.
Those recognizable names provide stability to Sunstone in regards to cash flow.
Analysts expect Sunstone to generate $1.5 billion in revenue in 2018 and $1.3 billion in revenue in 2019.
That incremental decline in sales is one reason shares of Sunstone have declined 5% since November of 2018.
But with a 5% dividend yield, investors in Sunstone are nearly doubling the current yield on the 10-year Treasury.
That’s huge outperformance that should be exploited in the current environment.
Now, here’s the top REIT to buy today…
Best REITs to Buy Now, No. 1:
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