Realty Income Has Raised Its Dividend 113 Consecutive Times. Here Is Why That Is Not Enough to Own It Right Now

3 hours ago 2

Alex Sirois

Fri, May 15, 2026 astatine 10:40 AM CDT 4 min read

Quick Read

Realty Income (O) trades astatine a guardant P/E of 40 with lone 2.8% expected AFFO maturation successful 2026, portion carrying 7.91x nett indebtedness to EBITDA and facing concentrated tenant hazard from apical 20 clients representing 35.8% of basal rent. AbbVie (ABBV) raised its quarterly dividend 5.5% to $1.73 with Q1 gross up 12.4% year-over-year, Skyrizi income surging 30.9% to $4.48 billion, and a much sustainable 48.8% payout ratio supported by 70.2% gross margins and 6.94x involvement coverage.
Income investors are progressively abandoning stretched nett lease valuations and precocious leverage for pharmaceutical dividend growth, arsenic AbbVie’s expanding net basal and little guardant aggregate of 14 connection amended semipermanent wealthiness gathering than Realty Income’s debt-funded yield.
The expert who called NVIDIA successful 2010 conscionable named his apical 10 stocks and AbbVie wasn't 1 of them. Get them present FREE.

Realty Income (NYSE:O) is dominating dividend feeds connected Reddit and X again, with monthly-payer loyalists pointing to its 113th consecutive quarterly dividend summation arsenic impervious you tin cod a cheque and tune retired the remainder of the market.

The underlying numbers archer a antithetic story.

The Math On O Has Quietly Broken

O trades astatine a trailing P/E of 55 and a guardant P/E of 40, valuations that beryllium to a maturation name, not a nett lease REIT carrying 7.91x nett indebtedness to EBITDA and lone 1.47x involvement coverage. The numbers underneath that aggregate are deteriorating. EPS missed statement by 16.05% successful Q4 2025, 12.67% successful Q3, 44.50% successful Q2, and 14.82% successful Q1. Interest disbursal climbed to $1.13 cardinal successful 2025 from $1.02 cardinal successful 2024, and impairment provisions deed $471.3 cardinal for the year. ROIC is negative.

The expert who called NVIDIA successful 2010 conscionable named his apical 10 stocks and AbbVie wasn't 1 of them. Get them present FREE.

Management's ain guidance underscores the issue. The 2026 AFFO usher of $4.38 to $4.42 implies 2.8% maturation astatine the midpoint contempt a $8.0 cardinal concern measurement usher for the year, a 27% step-up implicit 2025 deployment. CEO Sumit Roy has conceded that "meaningful upside whitethorn instrumentality years to materialize." Same-store rent maturation is guided astatine 1.0% to 1.3%, occupancy is acceptable to drift from 98.9% to 98.5%, and the apical 20 clients relationship for 35.8% of basal rent. Paying 40 times guardant net for sub-3% per-share growth, rising leverage, and concentrated tenant hazard is the trade-off status income buyers are progressively questioning successful speech for a monthly outgo cadence.