REALTY INCOME CORP (O) Stock Fundamental Analysis
NYSE:O - New York Stock Exchange, Inc. - US7561091049 - REIT - Currency: USD
We assign a fundamental rating of 4 out of 10 to O. O was compared to 130 industry peers in the Diversified REITs industry. O has a medium profitability rating, but doesn't score so well on its financial health evaluation. O is valied quite expensively at the moment, while it does show a decent growth rate. O also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
O had positive earnings in the past year.
In the past year O had a positive cash flow from operations.
O had positive earnings in each of the past 5 years.
Each year in the past 5 years O had a positive operating cash flow.
1.2 Ratios
O's Return On Assets of 1.23% is fine compared to the rest of the industry. O outperforms 61.54% of its industry peers.
O's Return On Equity of 2.18% is in line compared to the rest of the industry. O outperforms 54.62% of its industry peers.
O has a Return On Invested Capital of 2.77%. This is comparable to the rest of the industry: O outperforms 53.85% of its industry peers.
The Average Return On Invested Capital over the past 3 years for O is in line with the industry average of 3.17%.
The 3 year average ROIC (2.52%) for O is below the current ROIC(2.77%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.23% | ||
| ROE | 2.18% | ||
| ROIC | 2.77% |
ROA(3y)1.5%
ROA(5y)1.45%
ROE(3y)2.62%
ROE(5y)2.58%
ROIC(3y)2.52%
ROIC(5y)2.5%
1.3 Margins
The Profit Margin of O (16.09%) is better than 70.00% of its industry peers.
O's Profit Margin has declined in the last couple of years.
The Operating Margin of O (44.10%) is better than 88.46% of its industry peers.
In the last couple of years the Operating Margin of O has declined.
O has a Gross Margin of 92.83%. This is amongst the best in the industry. O outperforms 95.38% of its industry peers.
In the last couple of years the Gross Margin of O has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 44.1% | ||
| PM (TTM) | 16.09% | ||
| GM | 92.84% |
OM growth 3Y-1.7%
OM growth 5Y-2.42%
PM growth 3Y-2.35%
PM growth 5Y-11.32%
GM growth 3Y-0.27%
GM growth 5Y-0.26%
2. Health
2.1 Basic Checks
O has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for O has been increased compared to 1 year ago.
The number of shares outstanding for O has been increased compared to 5 years ago.
Compared to 1 year ago, O has a worse debt to assets ratio.
2.2 Solvency
O has an Altman-Z score of 1.01. This is a bad value and indicates that O is not financially healthy and even has some risk of bankruptcy.
O's Altman-Z score of 1.01 is fine compared to the rest of the industry. O outperforms 76.92% of its industry peers.
O has a debt to FCF ratio of 138.86. This is a negative value and a sign of low solvency as O would need 138.86 years to pay back of all of its debts.
The Debt to FCF ratio of O (138.86) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.68 indicates that O is somewhat dependend on debt financing.
O has a Debt to Equity ratio of 0.68. This is in the better half of the industry: O outperforms 77.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.68 | ||
| Debt/FCF | 138.86 | ||
| Altman-Z | 1.01 |
ROIC/WACC0.39
WACC7.03%
2.3 Liquidity
A Current Ratio of 0.55 indicates that O may have some problems paying its short term obligations.
The Current ratio of O (0.55) is worse than 73.85% of its industry peers.
A Quick Ratio of 0.55 indicates that O may have some problems paying its short term obligations.
O has a worse Quick ratio (0.55) than 73.08% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.55 | ||
| Quick Ratio | 0.55 |
3. Growth
3.1 Past
The earnings per share for O have decreased strongly by -22.22% in the last year.
Measured over the past years, O shows a decrease in Earnings Per Share. The EPS has been decreasing by -6.62% on average per year.
O shows a strong growth in Revenue. In the last year, the Revenue has grown by 29.23%.
Measured over the past years, O shows a very strong growth in Revenue. The Revenue has been growing by 28.78% on average per year.
EPS 1Y (TTM)-22.22%
EPS 3Y1.4%
EPS 5Y-6.62%
EPS Q2Q%-23.33%
Revenue 1Y (TTM)29.23%
Revenue growth 3Y36.33%
Revenue growth 5Y28.78%
Sales Q2Q%24.53%
3.2 Future
The Earnings Per Share is expected to grow by 14.73% on average over the next years. This is quite good.
O is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.70% yearly.
EPS Next Y54.46%
EPS Next 2Y30.41%
EPS Next 3Y20.38%
EPS Next 5Y14.73%
Revenue Next Year5.11%
Revenue Next 2Y5.02%
Revenue Next 3Y4.77%
Revenue Next 5Y3.7%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 58.12, the valuation of O can be described as expensive.
Compared to the rest of the industry, the Price/Earnings ratio of O is on the same level as its industry peers.
When comparing the Price/Earnings ratio of O to the average of the S&P500 Index (27.75), we can say O is valued expensively.
A Price/Forward Earnings ratio of 37.63 indicates a quite expensive valuation of O.
66.15% of the companies in the same industry are more expensive than O, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of O to the average of the S&P500 Index (20.49), we can say O is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 58.12 | ||
| Fwd PE | 37.63 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of O indicates a slightly more expensive valuation: O is more expensive than 66.92% of the companies listed in the same industry.
O's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 268.15 | ||
| EV/EBITDA | 16.28 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
O has a very decent profitability rating, which may justify a higher PE ratio.
O's earnings are expected to grow with 20.38% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.07
PEG (5Y)N/A
EPS Next 2Y30.41%
EPS Next 3Y20.38%
5. Dividend
5.1 Amount
O has a Yearly Dividend Yield of 5.64%, which is a nice return.
Compared to an average industry Dividend Yield of 16.33, O has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.44, O pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.64% |
5.2 History
The dividend of O has a limited annual growth rate of 4.20%.
O has paid a dividend for at least 10 years, which is a reliable track record.
O has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)4.2%
Div Incr Years27
Div Non Decr Years27
5.3 Sustainability
318.38% of the earnings are spent on dividend by O. This is not a sustainable payout ratio.
The dividend of O is growing, but earnings are growing more, so the dividend growth is sustainable.
DP318.38%
EPS Next 2Y30.41%
EPS Next 3Y20.38%
NYSE:O (5/2/2025, 3:53:10 PM)
56.96
-0.21 (-0.37%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryDiversified REITs
Earnings (Last)
Earnings (Next)
Inst Owners79.65%
Inst Owner Change0.17%
Ins Owners0.09%
Ins Owner Change-0.98%
Market Cap50.80B
Analysts70.34
Price Target61.94 (8.74%)
Short Float %2.4%
Short Ratio3.39
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.64% |
Yearly Dividend3.28
Dividend Growth(5Y)4.2%
DP318.38%
Div Incr Years27
Div Non Decr Years27
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-30.03%
Min EPS beat(2)-41.01%
Max EPS beat(2)-19.05%
EPS beat(4)0
Avg EPS beat(4)-35.4%
Min EPS beat(4)-59.78%
Max EPS beat(4)-19.05%
EPS beat(8)1
Avg EPS beat(8)-20.67%
EPS beat(12)3
Avg EPS beat(12)-14.16%
EPS beat(16)3
Avg EPS beat(16)-19.44%
Revenue beat(2)2
Avg Revenue beat(2)1.61%
Min Revenue beat(2)1.46%
Max Revenue beat(2)1.75%
Revenue beat(4)4
Avg Revenue beat(4)2.79%
Min Revenue beat(4)1.46%
Max Revenue beat(4)5.3%
Revenue beat(8)8
Avg Revenue beat(8)2.94%
Revenue beat(12)10
Avg Revenue beat(12)2.44%
Revenue beat(16)14
Avg Revenue beat(16)2.58%
PT rev (1m)0.18%
PT rev (3m)-4.11%
EPS NQ rev (1m)-0.4%
EPS NQ rev (3m)-5.56%
EPS NY rev (1m)-0.13%
EPS NY rev (3m)-6.37%
Revenue NQ rev (1m)0.53%
Revenue NQ rev (3m)-0.45%
Revenue NY rev (1m)-0.51%
Revenue NY rev (3m)-0.87%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 58.12 | ||
| Fwd PE | 37.63 | ||
| P/S | 9.64 | ||
| P/FCF | 268.15 | ||
| P/OCF | 14.22 | ||
| P/B | 1.31 | ||
| P/tB | 1.84 | ||
| EV/EBITDA | 16.28 |
EPS(TTM)0.98
EY1.72%
EPS(NY)1.51
Fwd EY2.66%
FCF(TTM)0.21
FCFY0.37%
OCF(TTM)4.01
OCFY7.03%
SpS5.91
BVpS43.55
TBVpS30.93
PEG (NY)1.07
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.23% | ||
| ROE | 2.18% | ||
| ROCE | 3.51% | ||
| ROIC | 2.77% | ||
| ROICexc | 2.79% | ||
| ROICexgc | 3.37% | ||
| OM | 44.1% | ||
| PM (TTM) | 16.09% | ||
| GM | 92.84% | ||
| FCFM | 3.59% |
ROA(3y)1.5%
ROA(5y)1.45%
ROE(3y)2.62%
ROE(5y)2.58%
ROIC(3y)2.52%
ROIC(5y)2.5%
ROICexc(3y)2.53%
ROICexc(5y)2.53%
ROICexgc(3y)3.06%
ROICexgc(5y)3.02%
ROCE(3y)3.19%
ROCE(5y)3.16%
ROICexcg growth 3Y13.03%
ROICexcg growth 5Y-1.09%
ROICexc growth 3Y15.09%
ROICexc growth 5Y-3.03%
OM growth 3Y-1.7%
OM growth 5Y-2.42%
PM growth 3Y-2.35%
PM growth 5Y-11.32%
GM growth 3Y-0.27%
GM growth 5Y-0.26%
F-Score5
Asset Turnover0.08
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.68 | ||
| Debt/FCF | 138.86 | ||
| Debt/EBITDA | 5.57 | ||
| Cap/Depr | 141.25% | ||
| Cap/Sales | 64.2% | ||
| Interest Coverage | 2.4 | ||
| Cash Conversion | 75.7% | ||
| Profit Quality | 22.34% | ||
| Current Ratio | 0.55 | ||
| Quick Ratio | 0.55 | ||
| Altman-Z | 1.01 |
F-Score5
WACC7.03%
ROIC/WACC0.39
Cap/Depr(3y)369.18%
Cap/Depr(5y)430.26%
Cap/Sales(3y)177.32%
Cap/Sales(5y)195.09%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-22.22%
EPS 3Y1.4%
EPS 5Y-6.62%
EPS Q2Q%-23.33%
EPS Next Y54.46%
EPS Next 2Y30.41%
EPS Next 3Y20.38%
EPS Next 5Y14.73%
Revenue 1Y (TTM)29.23%
Revenue growth 3Y36.33%
Revenue growth 5Y28.78%
Sales Q2Q%24.53%
Revenue Next Year5.11%
Revenue Next 2Y5.02%
Revenue Next 3Y4.77%
Revenue Next 5Y3.7%
EBIT growth 1Y29.44%
EBIT growth 3Y34%
EBIT growth 5Y25.67%
EBIT Next Year112.34%
EBIT Next 3Y33.45%
EBIT Next 5Y20.97%
FCF growth 1Y103.67%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y20.77%
OCF growth 3Y39.29%
OCF growth 5Y27.3%