Better Buy: Store Capital vs. Realty Income
Real estate investment trusts (REITs) with exposure to retail assets are getting hit hard these days. Realty Income (NYSE: O) and Store Capital (NYSE: STOR) are down from their recent highs by about 33% and 50%, respectively. The yields on these stocks are higher than they have been in a very long time. However, is one of these net lease REITs a better buy? That requires a little more digging.
Both Realty Income and Store Capital are net-lease real estate investment trusts. That means that they own properties, but their tenants are responsible for most of the operating costs of the assets they occupy. It's a fairly low-risk and low-maintenance approach, with the REITs basically making the difference between the rents they charge and their financing costs. So, at the core, they do basically the same thing, making this issue a wash (though still important to understand).
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Source Fool.com
