Beating the Dow is nice if you can do it. If you do, it means the stock you chose outdid a key barometer of the broader U.S. market: the 30 stocks that comprise the Dow Jones Industrial Average.

It obviously can be done and often is, and you can boost your chances by choosing a well-run company like Agree Realty (ADC 2.62%). This real estate investment trust (REIT) generates a steady flow of cash and dividends from a collection of more than 1,800 retail properties it owns across 48 states.

Agree is particularly attractive to income investors because it pays monthly, and it's been growing its dividends an annualized 6.1% a year for the past decade. Its record as a long-term investment is impressive, too, posting a compound average annual return of 12.5% since it went public in 1994.

But what about "beating the Dow?" Let's use the widely held SPDR Dow Jones Industrial Average ETF Trust as a benchmark. This chart shows how thoroughly Agree (with a market cap of about $6.1 billion) has outperformed the $28 billion exchange-traded fund in the past 15 years -- turning a $1,000 investment then into something just north of $6,000 now.

ADC Total Return Level Chart
ADC Total Return Level data by YCharts.

Dividends are half of the total return equation. And while the Dow includes many of America's most significant companies, they typically are not as focused on quarterly -- or in Agree's case, monthly -- payouts as Agree. As a REIT, Agree is required to pay out at least 90% of its taxable income to shareholders annually to maintain its tax status.

That also shows in the current yield. Agree is paying about 4% right now compared with under 2% for the Dow Jones ETF we're using here for comparison. This chart shows how consistent that outperformance has been over that same 15-year period.

ADC Dividend Yield Chart
ADC Dividend Yield data by YCharts.

A resilient business built on net leases

I chose 2008 to begin these comparisons because that was about when the Great Recession really got going, and conventional wisdom holds that we may be heading into another downturn again. Economies do cycle, after all. Agree's seasoned management coped well with that long recovery, forging a growing portfolio and sterling balance sheet that should continue providing solid returns come what may on the retail front.

The portfolio is dominated by investment-grade retailers, which provide nearly 70% of this retail REIT's rent roll. Walmart tops the latest list at 6.6%, followed in order by Dollar General, Tractor Supply, Best Buy, and Kroger. By sector, grocery stores account for 10.5% of the rent, followed in order by home improvement, tire and auto service, dollar stores, and convenience stores.

Most of Agree's tenants occupy free-standing, net-leased properties that require them to cover taxes, maintenance, and insurance. The trust has also grown its ground leases to about 12% of its business. Under that arrangement, tenants own the building but not the land. Together, they form the core of a business model that provides reliable, low-risk revenue that supports sustained payouts and leaves room to grow.

Despite no dip, Wall Street and insiders agree: It's a buy

Unlike many REITs, rising interest rates and inflation fears haven't beaten down this commercial real estate stock too badly. This chart shows how Agree's shares have performed year over year against the Dow ETF and another benchmark index, the Vanguard Real Estate ETF, in both terms of share price alone and total return.

ADC Chart
ADC data by YCharts.

Company insiders are confident, buying about $2.8 million of Agree's shares in the past year, at a time when the fairly steady price has offered scant opportunity to buy the dip. Analysts, meanwhile, give Agree a consensus target price of $78, which would be nearly a 20% gain over its current levels of about $66 per share.

That seems ambitious to me, at least in the short term, given the market's overall perception of commercial real estate right now. But the stock is still selling at a reasonable funds from operations (FFO) per share/share price ratio of about 16 to 1. Its payout ratio of about 79% based on cash flow also looks reasonable, considering the company's acquisition and FFO guidance going forward and its past performance.

In sum, Agree's consistent payouts, solid balance sheet, and growing, recession-resistant portfolio and client list make it a likely candidate to continue to beat the Dow.