This REIT Pays a 5% Dividend and Has Outperformed its Peers

Granite Real Estate Investment Trust (TSX:GRT.UN)(NYSE:GRP.UN) currently pays its investors a monthly dividend which yields over 5% per year. The company has shown a lot of stability over the years with sales rising for four consecutive years, and it also maintained an operating margin of over 70% during this time.

With earnings per share of $5.93, the company is paying out just 44% of its profits back to shareholders. Granite’s payouts havealso increased from $0.175 a share in 2013 to $0.217, for a growth of 24% and a compounded annual growth rate of 5.5%.

The company has almost 100 properties totaling 30 million square feet, located in Europe and North America. This provides a lot of diversification for real estate investors as Granite is not overly exposed to any one individual market.

This REIT provides a great opportunity for dividend investors as well as those looking for value and growth. The company trades at just eight times its earnings and that is a fairly low multiple given how consistently it has been able to grow sales. If we look at its peers, Granite trades well below Canadian REIT (TSX:REF.UN) which is at over 22 times its earnings and is alsolower than Morguard Real Estate Inv. (TSX:MRT.UN) which is priced at a multiple of just under 11.

Year-to-date, Granite’s stock has increased 14% and has vastly outperformed Canadian REIT’s 1% improvement in price, while Morguard’s share price has been negative. Although the stock is not far from its 52-week high, when looking at its peers, Granite is clearly a cut above.