ONYSE·REIT - Retail

Realty Income Corporation O

Market cap $51.9BP/E 40.6× trailingGross margin 68.6%Reports Mon 2 Nov, before the open

$55.68

+0.07 (+0.13%)live 09:40 ET

52-wk $55.27 – $67.94

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Orin's take

0.62conviction · moderate

Refreshed 22 Aug · take v7. A new filing or a print queues the next refresh.

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Realty Income remains a hold as the tension between strong AFFO execution and deteriorating GAAP quality persists. The company raised 2026 AFFO guidance to $4.44–$4.45, maintains 98.8% occupancy, and grew FY2025 revenue 9.1% to $5.75B with net income up 23.0%—but operating margin compressed from 44.0% in 2024 to 28.3% in 2025, total debt climbed to $32.9B from $26.8B, and the stock trades at 45.9x trailing earnings versus a peer median of 22.7x.

A 5.22% dividend yield and 69.5% FCF margin underpin the income case, while the EV/EBITDA of 13.8x sits roughly 8.7% below the peer median, offering partial valuation relief.

What could go wrong

Operating margin compression. Operating margin fell from 44.0% in FY2024 to 28.3% in FY2025 despite revenue growth of 9.1%, signaling rising cost pressure or portfolio mix shift that could further erode GAAP profitability.
Leverage accumulation. Total debt reached $32.9B as of FY2025 versus $26.8B in FY2024 and $15.9B in FY2021, a sustained debt-build that raises interest-rate sensitivity and balance-sheet risk.
Earnings multiple premium. At 45.9x trailing earnings versus a peer median of 22.7x—a premium of roughly 102%—any disappointment in AFFO growth or guidance could trigger multiple compression.
Insider selling pattern. Over the trailing 24 months, insiders recorded 45 dispositions against 25 acquisitions with net disposal value of $10.6M, a persistent negative signal from management.

What would change my mind

AFFO guidance raise sustained through 2026. Management reaffirms or raises AFFO guidance above $4.45 per share for full-year 2026 with occupancy holding above 98.5%bullish

Operating margin recovery. GAAP operating margin rebounds above 35% in a subsequent reporting period, indicating cost normalizationbullish

Debt-to-equity breach. Total debt-to-equity ratio exceeds 1.0x (currently approximately 0.83x at FY2025) or credit rating is cutbearish

Dividend coverage deterioration. AFFO payout ratio rises above 85% or dividend growth pauses after 115 consecutive quarters of increasesbearish

Where this comes from: derived_metrics FY2024–FY2025 · fundamentals FY2025 + derived_metrics FY2025 · fundamentals FY2025, FY2024 · peer_relative. Orin's read on O; not advice.

Twelve months actual closes to 2026-09-23 · actual filings

Sept 25Nov 25Jan 26Mar 26May 26Jul 26

50-day average 200-day average · volume below

On file

All O filings

Form	Filed	What it says	Read
8-K	25 Aug	Realty Income Corporation (O) filed an 8-K on August 25, 2026 disclosing that on August 20, 2026 it entered into two term loan amendments: a Second Amendment to its Wells…	read
8-K	14 Aug	Realty Income Corporation issued $1.125 billion aggregate principal amount of 3.750% Convertible Senior Notes due 2031 on August 14, 2026.	read
8-K	12 Aug	Realty Income Corporation announced the pricing of its 3.750% Convertible Senior Notes due 2031 on August 11, 2026.	read
8-K	11 Aug	Realty Income Corporation invested approximately $2.6 billion during the three months ended June 30, 2026, with a pro-rata share of $2.1 billion, in properties, properties under…	read
10-Q	5 Aug	Realty Income Corporation reported total revenue of $1.548 billion for the three months ended June 30, 2026, an increase of 9.7% year-over-year from $1.410 billion in the prior year period.	read
8-K	5 Aug	Realty Income Corporation raised its 2026 Adjusted Funds From Operations (AFFO) per share guidance to $4.44 - $4.45, representing approximately 4% growth.	read
8-K	13 Jul	On July 10, 2026, Realty Income Corporation entered into a Fifth Amended and Restated Credit Agreement, increasing its unsecured multicurrency revolving credit facilities capacity…	read
8-K	7 Jul	Realty Income Corporation closed its offering of €600.0 million aggregate principal amount of 3.625% Notes due 2032 on July 7, 2026.	read

Largest holders · 13F Q2 2026

Money flow

Filer	Position	Of fund
Vanguard Portfolio Management	$5.1B	0.2% of fund
State Street	$4.1B	0.1% of fund
Vanguard Capital Management	$3.8B	0.1% of fund
Geode Capital Management	$2.0B	0.1% of fund
Bank Of America /De/	$1.2B	0.1% of fund
Morgan Stanley	$894.7M	0.0% of fund

93 filers · quarter ended Q2 2026 · positions, not flows

Insiders, last 24 months: 71 Form 4 filings, net −$10.8M. Of the 50 on hand, 0 were open-market purchases and 3 sales— the rest are grants, option exercises and tax withholding.

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Where it trades

vs its own 5y · Real Estate

Metric	Now	Own median	Sector
P/E	40.6×	48.2×	56.8×
EV/EBITDA	12.2×	19.2×	—
P/S	8.74×	9.75×	—
P/B	1.3×	1.2×	—

Its P/E sits below all 5 of the last 5 years (−1.02σ from its own mean).

What the price assumes

1.8%

free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $4.0B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.

What Wall Street published

34 firms · 2026-09-23

Consensus target

$66

$61 – $71 · +18% against today's price

How they rate it

14 buy or overweight
17 hold
3 underweight or sell

The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.

Against the companies it is compared to

median P/E 21.2× of 4 peers

Company	Market cap	P/E	EV/EBITDA	Gross	Net	ROE
ORealty Income Corporation	$52B	40.6×	12.2×	68.6%	22.3%	3%
FRTFederal Realty Investment Trust	$9B	21.8×	13.9×	54.0%	32.7%	13%
KIMKimco Realty Corporation	$15B	25.0×	14.7×	54.8%	27.7%	6%
REGRegency Centers Corporation	$13B	20.6×	15.6×	35.1%	38.2%	10%
SPGSimon Property Group, Inc.	$66B	14.4×	12.1×	84.6%	66.4%	109%

The median is of the 4 peers listed above and nothing else — check it against the column. This company trades 91.3% above it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.

What it has traded at

P/E by fiscal year

FY14 44.9×FY25 48.2×

What its sector has traded at

Real Estate

FY14 44.0×FY26 52.3×

Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.

Discounted cash flow

not recomputed since

Model	Fair value	Against	Computed
Standard DCF	$81	$62.30 · +30%	2026-06-10
Levered DCF	$68	$62.30 · +9%	2026-06-10

The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.

Every estimate on one scale

price $55.68

52-week range$55 – $68

Analyst targets$61 – $71

Standard DCF$81 as of 2026-06-10, when it was $62.30

Levered DCF$68 as of 2026-06-10, when it was $62.30

At own 5y-median P/E (48×)$66

At 5y P/E range (45–83×)$61 – $113

At sector P/E (57×)$78

The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.