In this challenging interest rate environment we explore the performance of REITs relative to the S&P 500. To illustrate the industry’s performance in this environment Economatica chose the Top 25 REITs ranked by Total Assets and examined several key metrics.
As can be observed from the 5-year table below the median returns for this group relative to the S&P 500 have ranged from 0.41% in the YTD return to 16.26% in the 4-year return.
On an individual basis there are a handful of companies which have performed well despite the pressures of interest rates and other factors. The companies with the highest YTD returns relative to the S&P 500 are Equinix (31.15%), Prologis (27.51%), and Alexandria RE Equities (14.48%).
The three largest REITs by total assets Annaly Capital Management, AGNC Investment Corp, and Starwood Property Trust, posted YTD returns of -16.40%, -11.91%, and 7.44% respectively.
Dividend Yield and Dividend Paid per Share have remained stable and consistent throughout this period.
The indicators Return on Assets (ROA) and EBIT/Net Interest Expense, two key evaluation metrics for REITs, have also remained relatively stable in 2018 and 2019.
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