It goes up, down, up and down again Realty Income Corp. O this year, as you can see on the Real Estate Investment Trust (REIT) daily chart:
Other REITs’ price charts show some volatility, but most don’t move with that kind of ferocity. That’s nearly a 12-point move from the late February low of $62.50 to the April high of $74, a 15.5% gain in about two months.
Then, from that April high of $74, the price of Realty Income sold off below the February level. Mid-May low is just below $62 on an intraday basis. That’s down 16.2% before buyers reappeared. The late-May peak of $68.50 took the REIT to a fresh 2022 low of $61.55 by mid-June.
What happened next? Another big rally. This time the price surged to a new 2022 high of $75.55 (intraday). This was not the case as selling returned and the REIT steadily declined through mid-September, falling back to the $63 level.
One of the reasons for the ups and downs could be that investors are constantly pondering how badly REITs like Realty Income could be affected by the Fed’s likely rate hike. The company pays a sizable dividend — 4.63%, which makes it vulnerable to interest rate resets. Price changes may affect the values of the underlying properties.
Also see: This little-known REIT has posted double-digit annual returns over the past five years
Here’s Realty Income’s weekly price chart for a slightly longer-term perspective.
This is an exceptional rally from the March 2020 pandemic low to the recent high above $75. It wouldn’t be unusual for a REIT to catch its breath after such a strong bullish market move. This late September 2021 low near $60 appears to be a significant support level. A close below would be worrying from a price chart analysis perspective.
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No investment advice. For educational purposes only.
Charts: Courtesy of StockCharts