June 20, 2024

According to investment research giant Morningstar, some of the biggest real estate companies, or REITs (real estate investment trusts), are now available at substantial discounts to what analysts consider fair value.
REITs are a good addition to portfolios for many investors as they offer a way to get exposure to real estate while still having high liquidity on your investment.
A share in a REIT can be sold close to instantly in the same way as other shares, contrasting sharply with the often long sale process of selling an actual piece of real estate.
Another big benefit is the income stream they can provide via dividend payouts. This effectively allows shareholders in a REIT to ‘collect rent’ from tenants without any of the work or costs involved in actually owning houses, offices, or retail units as a landlord.
REITs are required to pay at least 90% of their income to investors as dividends, so the payouts can be high.
There are many different REITs available in the market with various focuses and specialisms. Some target residential housing, others retail, offices or industrial buildings. They often have a mixture of property types under ownership.
The analysts at Morningstar have run the numbers across the market and identified the 10 real estate stocks offering the best opportunitie right now based on their discount to Morningstar’s fair value price.
If you are thinking of taking the plunge, here is a great place to start:
Ticker: MAC
Market cap: $ 2.48 billion
Price / Fair value: 0.36
Dividend yield: 5.78
Morningstar stock rating: 5 star
Ticker: SPG
Market cap: $ 37.7billion
Price / Fair value: 0.67
Dividend yield: 6.57
Morningstar stock rating: 5 star
Ticker: VTR
Market cap: $ 20.3 billion
Price / Fair value: 0.71
Dividend yield: 3.68
Morningstar stock rating: 4 star
Ticker: PEAK
Market cap: $ 15.3 billion
Price / Fair value: 0.74
Dividend yield: 4.53
Morningstar stock rating: 4 star
Ticker: KIM
Market cap: $ 14.7 billion
Price / Fair value: 0.81
Dividend yield: 4.11
Morningstar stock rating: 4 star
Ticker: WELL
Market cap: $ 36.4 billion
Price / Fair value: 0.83
Dividend yield: 3.02
Morningstar stock rating: 4 star
Ticker: EQR
Market cap: $ 30.2 billion
Price / Fair value: 0.85
Dividend yield: 3.26
Morningstar stock rating: 4 star
Ticker: ESS
Market cap: $ 19.3 billion
Price / Fair value: 0.87
Dividend yield: 3.16
Morningstar stock rating: 4 star
Ticker: AVB
Market cap: $ 30.7 billion
Price / Fair value: 0.88
Dividend yield: 3.1
Morningstar stock rating: 4 star
Ticker: INVH
Market cap: $ 24.3 billion
Price / Fair value: 0.9
Dividend yield: 2.32
Morningstar stock rating: 4 star
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