Key Reasons to Add W.P. Carey Stock to Your Portfolio Now

W.P. Carey WPC is well-poised to gain from one of the largest high-quality portfolios of single-tenant net lease commercial real estate. Its specialty in providing long-term sale-leaseback for companies yields steady revenue generation. A diverse portfolio with contractual rental bumps aids stable cash flows. Strategic portfolio repositioning efforts appear promising. A solid balance sheet boosts its growth endeavors.In early April, WPC provided a business update regarding its first-quarter investment and disposition volume, tenant credit position, loan refinance, loan assumption and repayment. The company affirmed 2025 adjusted funds from operations (AFFO) guidance, boosting shareholders’ confidence in this leading net lease real estate investment trust (REIT).Analysts seem bullish about this Zacks Rank #2 (Buy) company, with the Zacks Consensus Estimate for its 2025 AFFO per share being raised marginally over the past two months to $4.85.Over the past three months, WPC shareshave rallied 16.1%, outperforming the industry’s growth of 5.4%.Image Source: Zacks Investment ResearchFactors That Make W.P. Carey Stock a Solid PickHigh-Quality Mission-Critical Portfolio: W.P. Carey has one of the largest portfolios of single-tenant net lease commercial real estate in the United States, and Northern and Western Europe. The company invests in high-quality assets that are mission-critical for its tenants’ operations.The company specializes in sale-leaseback transactions, whereby it acquires critical real estate from other entities and then leases them back to the seller on a long-term, triple-net basis. As such, due to the inherent nature of its portfolio, the REIT can generate better risk-adjusted returns owing to higher occupancy. The portfolio occupancy as of Dec. 31, 2024 was 98.6%.Diverse Tenant Base: W.P. Carey’s portfolio is well-diversified by tenant, industry, property type and geography, aiding steady revenue generation. As of Dec. 31, 2024, its top 10 tenants constitute 19.3% of ABR. Moreover, the existence of long-term net leases with built-in rent escalations yields stable cash flows. The company witnessed contractual same-store rent growth of 2.6% for the fourth quarter of 2024.Expansion Efforts: W.P. Carey has been capitalizing on growth opportunities. Per the April Business Update, during the first quarter of 2025, W.P. Carey made investments to the tune of $275 million, largely through the sale-leaseback of industrial properties, and disposed of assets worth around $130 million.For 2025, management expects a total investment value between $1 and $1.5 billion and total dispositions between $500 million and $1 billion. The sale would largely include non-core assets and gross sale proceeds are to be used for funding value-accretive investments. Such match-funding efforts indicate the company’s prudent capital-management practices and will relieve pressure from its balance sheet, which is encouraging.Balance Sheet Strength:  W.P. Carey has a healthy balance sheet position with ample liquidity. As of Dec. 31, 2024, the company had a total liquidity of $2.6 billion, including around $1.9 billion of available capacity under its senior unsecured credit facility and $640.4 million of cash and cash equivalents. As of Dec. 31, 2024, the company’s share of pro rata net debt to adjusted EBITDA was 5.5X. The company also enjoys investment-grade ratings of BBB+ from S&P Global Ratings and Baa1 from Moody’s, rendering it favorable access to the debt market.Steady Dividend Payouts: Solid dividend payouts are arguably the biggest enticement for investment in REIT stocks, and W.P. Carey remains committed to it. However, in December 2023, WPC reduced its dividend to 86 cents from the prior quarter's dividend payment of $1.07. The move resulted from the company’s strategic plan to exit its office assets.Thereafter, it maintained a disciplined capital distribution strategy and increased its dividend three times, which is encouraging. Looking at WPC’s operating environment and financial position compared to that of the industry’s average, its current dividend is expected to be sustainable in the upcoming period.Other Stocks to ConsiderSome other top-ranked stocks from the broader REIT sector are Welltower WELLand Cousins Properties CUZ, each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.The Zacks Consensus Estimate for Welltower’s 2025 FFO per share has been moved marginally northward to $4.93 over the past week.The consensus estimate for Cousins Properties’ 2025 FFO per share has been moved upward by 1.8% to $2.79 over the past month.Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cousins Properties Incorporated (CUZ): Free Stock Analysis Report W.P. Carey Inc. (WPC): Free Stock Analysis Report Welltower Inc. (WELL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks