If you invested $10,000 into STAG Industrial (NYSE: STAG) three years ago, you would have around $10,700 today. That sounds somewhat underwhelming, but if you dig in a little bit deeper you'll see that this is much better than it at first seems. Here's why a stock that looks like it's dead in the water turned out to be a solid win for investors.

Over the past three years or so STAG has steadily grown. It started 2020 off with 450 industrial properties and an occupancy rate of 95%. At the end of the third quarter of 2022, the real estate investment trust's (REIT) portfolio stood at 563 industrial properties sporting an occupancy rate of 96.4%. It maintained financial discipline while expanding, with a balance sheet that's basically just as strong today as it was three years ago. The adjusted funds from operations (FFO) payout ratio, meanwhile, improved to roughly 65% from 75%.

It would be very hard to suggest that the last three years were wasted time for STAG as a company. And yet the stock today is only up about 7% from where it was three years ago. To be fair, that's much better than the average REIT, which is down about 8% from three years ago using the Vanguard Real Estate Index ETF (NYSEMKT: VNQ) as a proxy. However, the S&P 500 index is up 22% over that span, so it's hard to look at STAG's stock price and think of it as a total win.

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Source Fool.com