One of the fastest-growing, and perhaps most promising, real estate investment trusts (REITs) right now is VICI Properties Inc. VICI, which is being added to the S&P 500 index this week. The company recently acquired The Venetian Las Vegas and its closest competitor in the gaming space, MGM Growth Properties.
Analysts currently have VICI Properties rated as a buy, with a consensus price target of $37 per share. Goldman Sachs GS recently increased its price target for VICI from $35 to $39.
In addition to the upside potential on its share price, the REIT has also maintained an attractive dividend yield. VICI’s dividend rate has increased by over 25% in the past three years and currently has a forward yield of 4.59%.
Hear VICI's CEO, Ed Pitoniak, on the Lazy Landlord podcast.
How much would you be receiving in dividend income now if you invested $1,000 in VICI Properties three years ago?
VICI’s share price opened at $22.57 on June 7, 2019, meaning you could have purchased 44.3 shares for $1,000. You would have received your first dividend of $0.2875 per share for a total payment of $12.74 on July 12, 2019, and earned a yield of 5.23% during the first 12 months you owned the stock.
With the REIT’s most recent dividend of 36 cents per share, your quarterly dividend payments would now be $15.95 for a forward yield of 6.4% on your original investment.
Investing in VICI Properties three years ago would have resulted in a gain of $453.48 plus a total of $171.77 in dividends for a 62.5% total return and a compound annual return of 17.6%.
Reinvesting the dividends each quarter over the past three years would have proven to be even more profitable.
By reinvesting your dividends, you could have accumulated an additional 7.5 shares. This would bring your quarterly dividend payments to $18.65 for a forward yield of 7.46%.
You would now own 51.8 shares of VICI Properties with a total value of 1,699.56, bringing your total return to 69.96% and your compound annual return to 19.34%.
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