Seven REIT stocks pass a strict financial screen, with dividends as high as 6.27%

MW Seven REIT stocks pass a strict financial screen, with dividends as high as 6.27%

By Philip van Doorn

Two casino owners make the list

Bally's Casino in Blackhawk, Colo., is among the facilities owned by Gaming & Leisure Properties, which passed a financial screen of real-estate investment trusts.

Real-estate investment trusts are typically considered to be income investments because they have tax advantages requiring them to distribute most of their profits to shareholders through dividends. Any investor will be afraid of a potential dividend cut, which can cause a company's share price to plunge. So below is a screen for REITs that seem well-positioned to maintain or raise their dividends.

In the REIT industry, funds from operations (FFO) is often used as a measurement of a company's cash available for dividend distributions. This is a non-GAAP metric that adds depreciation and amortization back to earnings, while subtracting gains from the sale of property.

Adjusted funds from operations (AFFO) takes this concept further, netting out the costs to maintain properties that REITs rent out.

So if we divide a REIT's annual AFFO by its share price, we have an AFFO yield that we can compare to the REIT's dividend yield to see if there is headroom above the dividend. That can provide some comfort to investors that the REIT at least can maintain the dividend and hopefully increase the payout over time.

A screen of equity REITs for solid dividend payouts

There are two broad categories of REITs. An equity REIT develops or owns property to rent out or to sell. A mortgage REIT invests in mortgage-backed securities or issues mortgage loans. Some REITs operate in both camps.

A pure mortgage REIT won't have estimated AFFO figures, since it won't spend money to maintain investment properties. This screen focuses on equity REITs.

For a deep dive into this industry, we began with the 174 REITs in the Russell 3000 Index RUA, which itself is designed to capture 98% of the market for stocks listed on U.S. exchanges.

Among the REITs, there are 108 that are covered by at least five analysts working for brokerage and research firms polled by FactSet and for which consensus 2026 AFFO estimates are available.

Among those 108, there are 86 with indicated AFFO headroom of at least 1.00%, based on current dividend yields and the consensus 2026 AFFO estimates.

There are two further tests, based on suggestions from Lewis Altfest, chief executive of Altfest Personal Wealth Management in New York, who warned MarketWatch in a previous interview that if a stock has a very high dividend yield, "there is something going on." A high yield means that the share price is low and that investors have anticipated a dividend cut by steering clear.

Altfest suggested avoiding REITs that showed declines in revenue. Among the remaining REITs, 11 showed declines in annual revenue during 2025. This brought our list down to 75 REITs.

Since AFFO adds depreciation and amortization back to earnings, Altfest asked whether or not these adjustments accounted for more than half of a REIT's dividends. So we cut the list drastically to remove any companies for which depreciation and amortization made up more than half the dividends paid during 2025. This left us with seven REITs.

Here they are, sorted by dividend yield:

   REIT                            Dividend yield  Estimated 2026 AFFO yield  Estimated headroomInvestment concentration 
   VICI Properties                          6.02%                      8.18%               2.16%Casinos and casino hotels 
   Gaming & Leisure Properties              6.27%                      8.21%               1.94%Casinos and casino hotels 
   CareTrust REIT                           3.41%                      5.07%               1.66%Senior housing and medical 
   LTC Properties                           5.91%                      7.31%               1.40%Senior housing and medical 
   Four Corners Property Trust              5.74%                      7.21%               1.47%Retail 
   Sun Communities                          3.06%                      4.64%               1.58%Multifamily residential 
   National Health Investors                4.34%                      6.06%               1.72%Senior housing 
                                                                                                             Source: FactSet 

Any time you consider an individual stock for investment, you should do your own research to form your own opinion on how likely the company is to remain competitive over the next decade. One way to begin that process is to click on the tickers for more information, including charts, financials and analysts' ratings.

Read: Tomi Kilgore's guide to the wealth of information available for free on the MarketWatch quote page

Honorable Mentions

Two of the REITs that we screened just missed the list because depreciation and amortization came to 51% of their distributed dividends during 2025. Here they are:

   REIT                          Dividend yield  Estimated 2026 AFFO yield  Estimated headroom  Investment concentration 
   Lamar Advertising Class A              4.60%                      6.27%               1.67%                Billboards 
   Simon Property Group                   4.33%                      5.79%               1.45%            Shopping malls 
                                                                                                         Source: FactSet 

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-Philip van Doorn

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March 05, 2026 12:00 ET (17:00 GMT)

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