Performance in the real estate sector generally tracks the economic cycle. During periods of high growth and inflation, real estate investments usually post strong returns. However, during an economic bust, these investments tend to underperform. During these times, companies such as LSL Property Services and A & J Mucklow Group generate high dividend income to shareholders. As a long term investor, I favour these real estate stocks with great dividend payments that continues to add value to my portfolio.
LSL Property Services Plc (LSE:LSL)
LSL has a sizeable dividend yield of 3.67% and their current payout ratio is 19.35% , with analysts expecting a 40.00% payout in three years. Although there has been some volatility in the company’s dividend yield, the DPS over a 10 year period has increased from £0.06 to £0.103. LSL Property Services’s earnings per share growth of 70.39% outpaced the gb real estate industry’s 29.88% average growth rate over the last year.
A & J Mucklow Group Plc (LSE:MKLW)
MKLW has an alluring dividend yield of 4.29% and is currently distributing 47.30% of profits to shareholders , and analysts are expecting the payout ratio in three years to hit 91.66%. The company’s dividends per share have risen from £0.1473 to £0.2212 over the last 10 years. The company has been a reliable payer too, not missing a payment during this time. The company outperformed the gb reits industry’s earnings growth of -7.90%, reporting an EPS growth of 17.46% over the past 12 months.
Standard Life Investments Property Income Trust Limited (LSE:SLI)
SLI has a juicy dividend yield of 10.46% and their current payout ratio is 78.28% . Although investors would have seen a few years of reduced payments, it has so far always picked up again, with dividends increasing from £0.0676 to £0.0952 over the past 10 years. The company has performed strongly in the last 5 years, growing its earnings by 11.58% in this time.
For more solid dividend payers to add to your portfolio, you can use our free platform to explore our interactive list of top dividend payers.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.