In this article, we will discuss 5 real estate dividend stocks with high yields. If you want to read our detailed analysis of the real estate market, you can go directly to 10 Real Estate Dividend Stocks with High Yields.
5. Chimera Investment Corporation (NYSE:CIM)
Dividend Yield: 8.28%
Number of Hedge Funds: 16
Chimera Investment Corporation (NYSE:CIM) is a New York-based internally managed REIT. Founded in 2007, the company invests in asset securitization, residential mortgage loans, and mortgage-related securities. Chimera Investment Corporation (NYSE:CIM) has paid out $5.5 billion as dividends to its common and preferred stockholders since its inception.
Chimera Investment Corporation (NYSE:CIM) declared a quarterly dividend of 33 cents per share on December 2, payable on January 27, 2022. The ex-dividend date of the stock is December 29. The company used to pay out a quarterly dividend of 50 cents per share before the pandemic but was forced to cut it to 30 cents per share during the period. However, it was again increased to 33 cents per share in Q2 2021, reflecting the management’s desire to restore the dividend to pre-pandemic levels.
Chimera Investment Corporation (NYSE:CIM) reported its Q3 2021 results on November 3. The company’s netbook value stood at $12.32, making it one of the few stocks on the list, trading at a premium of more than 29%. Chimera Investment Corporation (NYSE:CIM) brought in $850 million worth of new loans during the quarter under its investment portfolio. The company is working on improving its profitability with a stable and long-term view.
4. New Residential Investment Corp. (NYSE:NRZ)
Dividend Yield: 8.99%
Number of Hedge Funds: 16
New Residential Investment Corp. (NYSE:NRZ) provides mortgage and financial services industries with capital and services. The company aims to identify and invest in attractive assets and protect its existing portfolio, to generate strong risk-adjusted returns for the shareholders.
In a research note issued on September 29, Mark DeVries resumed coverage of New Residential Investment Corp. (NYSE:NRZ) with an Outperform rating and a price target of $13. The analyst thinks that the corporation has increased its exposure in the “still-strong” mortgage origination industry through the acquisition of Caliber Home Loans in August 2021. The analyst also added that in case of a rise in interest rate, the stable underlying portfolio of New Residential Investment Corp. (NYSE:NRZ) would decrease the volatility in earnings and provide stability to the book value.
3. AGNC Investment Corp. (NASDAQ:AGNC)
Dividend Yield: 9.22%
Number of Hedge Funds: 16
AGNC Investment Corp. (NASDAQ:AGNC) lands the third position on our list of 5 real estate dividend stocks with high yields. The Bethesda, Maryland-based company deals in agency MBS on a leveraged basis that is funded through collateralized borrowings structured as repurchase agreements. AGNC Investment Corp.’s (NASDAQ:AGNC) portfolio value stands at $84.1 billion as of Q3 2021.
AGNC Investment Corp. (NASDAQ:AGNC) is one of the stocks on the list that pays out a monthly dividend. For November, the company declared a monthly dividend of 12 cents per share, payable on December 9. As of October 31, the company’s tangible net book value stood at $16.47 per common share.
On November 27, Mark DeVries at Barclays gave AGNC Investment Corp. (NASDAQ:AGNC) an Equal Weight rating with a $17 price target. The analyst anticipates the core earnings of the company to outperform its dividend obligations and sees the stock as fairly valued.
2. MFA Financial, Inc. (NYSE:MFA)
Dividend Yield: 7.63%
Number of Hedge Funds: 17
MFA Financial, Inc. (NYSE:MFA) invests in residential mortgage products like residential MBS and residential whole loans on a leveraged basis.
During Q3 2021, MFA Financial, Inc. (NYSE:MFA) generated a GAAP net income of 27 cents, increasing by 13% on a sequential basis and comprehensively outperforming the consensus forecast of 11 cents. The economic book value of MFA Financial, Inc. (NYSE:MFA) stood at $5.27 per share, translating into a discount of 12.9% from the stock price. The company paid a dividend of 10 cents per share for the third quarter of 2021 on October 29.
In a report issued to investors on December 8, Stephen Laws at Raymond James upgraded the New York-based firm from Market Perform to an Outperform rating with a price target of $5.25. The analyst highlighted the stellar Q3 2021 results and upgraded MFA Financial, Inc. (NYSE:MFA) stock in anticipation of generating attractive portfolio returns in the future also. The analyst sees the bottom line of MFA Financial to receive some tailwind due to strong net interest income as a result of new investments and low cost of financing. Furthermore, MFA Financial, Inc. (NYSE:MFA) is expected to see more net gains on loans and a higher generation of business purpose loans (BPL) from the acquisition of Lima One.
1. Two Harbors Investment Corp. (NYSE:TWO)
Dividend Yield: 11.26%
Number of Hedge Funds: 31
Two Harbors Investment Corp. (NYSE:TWO) is focused on investing, financing, and managing Agency residential MBS, MSR, and other financial products. The Minnetonka, Minnesota-based company refers to these products as target assets and provides injection in the form of financing for real estate that can generate income.
In the Q3 2021 results released on November 8, Two Harbors Investment Corp. (NYSE:TWO) reported adjusted EPS of 24 cents as opposed to the consensus estimate of 20 cents. During the quarter, the corporation settled $29 billion worth of unpaid principal balance (UPB) and committed to acquiring $21 billion worth of UPB.
Two Harbors Investment Corp. (NYSE:TWO) is structured as a REIT for federal income tax purposes. A REIT is required to payout at least 90% of its annual taxable income as a dividend to its stockholders. The firm has been paying out dividends to its investors for the past 11 consecutive years. However, Two Harbors Investment Corp. (NYSE:TWO) could not maintain its continuous dividend growth as it was forced to resort to a dividend cut due to the pandemic in 2020. During Q3 2021, Two Harbors Investment Corp. (NYSE:TWO) paid out a quarterly dividend of 17 cents per share.
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