What's the best stock on the market for income investors? To be honest, I'm not sure. There are quite a few worthy candidates. However, I think that Realty Income (O 0.18%) ranks among the top contenders. Here are five reasons income investors will absolutely love this high-yield dividend stock.
1. The high yield (of course)
I've already intentionally given away the most crucial attraction for Realty Income. Its forward dividend yield tops 5.2%. Sometimes, high dividend yields are a warning sign of potential problems with a stock. That's not the case with Realty Income, though.
Realty Income's dividend payout is so juicy primarily because it's a real estate investment trust (REIT). All REITs must return at least 90% of their income to shareholders as dividends to be exempt from federal income taxes. Unsurprisingly, REITs often offer high dividend yields.
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Real estate companies must generate profits to pay those dividends. That's not an issue with Realty Income. The REIT recorded net income of over $766 million in the first nine months of 2025.
2. An impressive track record of dividend hikes
Income investors don't like their dividend income to be eroded by inflation. They won't have to be concerned about this possibility with Realty Income. The REIT has increased its dividend for over 30 consecutive years with a compound annual growth rate (CAGR) of 4.2%.
Be prepared to be even more impressed. Realty Income has increased its dividend a stunning 133 times since listing its shares on the New York Stock Exchange (NYSE) in 1994. This track record includes 112 consecutive quarterly dividend increases.
3. Get paid monthly
Realty Income offers another big bonus for income investors. The REIT pays its dividend monthly rather than quarterly. It even trademarked the name, "The Monthly Dividend Company." Realty Income has paid dividends for 667 consecutive months.
4. Stability
Income investors don't like drama. Realty Income provides the stability they prefer.
The company has delivered 29 consecutive years of positive total operational returns. Total operational returns, by the way, are the sum of adjusted funds from operations (FFO) per share growth and dividend yield.
Since Realty Income's NYSE listing in 1994, the S&P 500 (^GSPC +0.03%) has fallen by 10% or more 13 times. Realty Income's shares experienced a greater decline than the index only twice. The stock rose on three occasions when the S&P 500 fell by at least 10%. Unsurprisingly, the REIT's beta versus the index is a low 0.5.
What makes Realty Income so stable? Its diversified portfolio of properties. The company owns more than 15,500 with tenants representing 92 industries. This diversification enables Realty Income to deliver steady free cash flow, helping keep dividends flowing.
5. Growth opportunities
Many income investors don't only seek income from the stocks they own. They'd also love to see share price appreciation. Realty Income checks off this box, too.
The REIT has generated a compound annual total return of 13.7% since its NYSE listing. Its total return trounced the S&P 500 during the period. Granted, the S&P 500 has outperformed Realty Income in recent years, with mega-cap tech stocks cashing in on the artificial intelligence (AI) boom. However, Realty Income's growth opportunities over the next decade are encouraging.
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Key Data Points
The company estimates its total addressable market is around $14 trillion. Realty Income continues to have significant growth potential in the U.S., but its greatest opportunity lies in Europe, which accounts for around 60% ($8.5 trillion) of its total addressable market.
Europe also has a highly fragmented competitive landscape. Realty Income should have an easier path to growth than in the U.S.
Additionally, the REIT has growth opportunities in the private capital markets. Realty Income's industry expertise gives it an advantage as it expands into offering private capital. Management believes this new initiative could generate recurring fees that boost its long-term earnings growth.
