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Better Buy: Realty Income vs. Whole Foods

By Mark Reeth and Patrick Morris – Mar 22, 2014 at 10:00AM

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We've collected the most popular companies amongst Fool.com readers and put them head-to-head in a good old-fashioned challenge we're calling The Motley Fool's Better Buy Tournament.

In today's ­second-round match-up of The Motley Fool's Better-Buy Tournament, Realty Income squares off against Whole Foods Market in a battle to determine which stock is the better buy now. The 64-company tournament pits two Motley Fool analysts against each other as they make the case for their stocks with the winner determined by you, the readers.

Any company that boldly labels itself as "the monthly dividend company" will always pique the interest of many investors looking for income, but it turns out Realty Income (O 1.72%) is something everyone should consider. The reality that it has increased its dividend for 66 consecutive quarters is eye-opening and appealing, but so is the fact that its ever-important adjusted funds from operations rose by 17% last year. Throw in a diverse revenue stream from a variety of businesses, and a great management team, and there is no denying the investment potential here. Patrick Morris makes the case for Realty Income.

Motley Fool consumer-goods editor Mark Reeth, meanwhile, believes that Whole Foods Market (WFM) has a lot of growth ahead of it. Although the company has been top dog in the natural-food revolution for years, the healthy-eating trend is only getting stronger in the United States. That's why, even though the company has around 370 stores in the United States, it sees room for a total of 1,200 and will continue opening stores to hit that goal. When it does open new stores, they turn a profit quickly, with same-store sales at locations open for less than two years, hitting 20% this last quarter. 

Watch these analysts square off in the following video, and then vote for a winner. Then check out the other companies in The Motley Fool's Better-Buy Bracket

This year's winning stock?
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Cast your vote in the poll below the video!

John Mackey, co-CEO of Whole Foods Market, is a member of The Motley Fool's board of directors.

Mark Reeth and Patrick Morris have no position in any stocks mentioned. The Motley Fool recommends and owns shares of Whole Foods Market. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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