The Nasdaq has long been the stock market home of high-tech innovatots that have gone from unknown start-ups to household names.
This exchange is where game-changers like Apple, Amazon, Microsoft, and Tesla have consistently helped drive the Nasdaq Composite Index (^IXIC -1.08%) to new heights.
Over the past five years, in fact, the Nasdaq index has easily outpaced the two other major benchmarks, the Dow Jones Industrial Average (DJIANDEX: ^DJI) and the S&P 500 (^GSPC -0.78%), as you can see below:
Indeed, riding the excitement generated by all of those technology game-changers, the Nasdaq has done almost as well as, well, Mid-America Apartment Communities (MAA -0.60%), a stalwart in the comparatively boring business of providing people with a place to live.
Outperformance from one of America's largest landlords
Known as MAA, this real estate investment trust (REIT) is one of the U.S.'s largest landlords, with a collection of approximately 300 apartment communities and about 102,000 units primarily in Sunbelt growth markets such as Atlanta; Dallas, Houston, and Austin in Texas; Orlando and Tampa in Florida; Charlotte, North Carolina; Nashville, Tennessee; and Charleston, South Carolina.
This chart shows how well MAA has fared over the past five years against both the Nasdaq Composite Index, which tracks the movement of the 3,600 or so stocks trading on that exchange at any given time, and the Invesco QQQ Trust Total Return (QQQ -0.93%), which with a market cap of about $135 billion is one of the largest the exchange-traded funds that track Nasdaq's 100 largest stocks.
Actively winning at passive income
That chart above shows total return terms, which account for both share price movement and reinvested dividends. And dividends are the key here for this value stock. MAA is a reliable producer of passive income, with a yield of about 3.7%, a good bit more than the 0.71% yielded by the Invesco QQQ Trust.
Here's another pair of charts. These illustrate the impact of dividends on total returns over the same five years for MAA and the Invesco QQQ ETF.
This is not an aberration. MAA has been public for 28 years and, during that time, has paid 116 straight quarterly cash dividends, including a payout of $1.40 per share in January that was a healthy 12% more than the previous quarter and marked 13 straight years of increases.
The Memphis, Tennessee-based company has also provided an annually compounded total shareholder return of 13.2% over the past 10 years, while a stellar A- credit rating from Standard & Poor's and a very modest 3.97 ratio of net debt-to-earnings before interest, taxes, depreciation, and amortization (EBITDA) speak to the strength of its balance sheet.
MAA stock is currently selling for about 25% less than a year ago at this time, as this residential REIT has seen the same sell-off that higher interest rates and concerns over the ability to continue rapid rent increases (and income) have sparked among its peers.
That could make this a great time to pick up some shares of this longtime producer of strong shareholder returns with a record that can match that of many a glamorous growth stock, especially for buy-and-hold investors interested in such mundane things as sustainable retirement income.
