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Key Reasons to Add W.P. Carey Stock to Your Portfolio Now
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Key Takeaways
{\"0\":\"W.P. Carey\'s Q2 AFFO of $1.28 beat estimates, rising 9.4% year over year.\",\"1\":\"98.2% occupancy and 2.3% rent growth underscore portfolio strength.\",\"2\":\"$548.6M in Q2 investments and $364.2M in sales show prudent capital use.\"}
W.P. Carey’s (WPC - Free Report) mission-critical, single-tenant net lease commercial diverse portfolio, with contractual rent bumps, strategic portfolio repositioning and a healthy balance sheet, are key upsides.
Last month, WPC reported second-quarter 2025 adjusted funds from operations (AFFO) per share of $1.28, surpassing the Zacks Consensus Estimate of $1.23. The figure improved 9.4% from the year-ago quarter.
Results reflected higher revenues, aided by strong investment activity and a disciplined disposition strategy. WPC raised its full-year 2025 AFFO per share guidance.
However, analysts seem bearish about this Zacks Rank #2 (Buy) company, with the Zacks Consensus Estimate for its 2025 AFFO per share being revised southward by one cent over the past month to $4.87.
WPC shares have rallied 20.6% year to date, outperforming the industry’s growth of 2%.
Image Source: Zacks Investment Research
Factors That Make W.P. Carey Stock a Solid Pick
High-Quality, Mission-Critical Portfolio: W.P. Carey has one of the largest portfolios of single-tenant net lease commercial real estate in the United States, and Northern and Western Europe. The company invests in high-quality assets that are mission-critical for its tenants’ operations.
Through accretive expansions, renovations and follow-on deals, the company capitalizes on the existing tenant relationships by generating value-creation opportunities within its existing portfolio. As such, due to the inherent nature of its portfolio, the REIT enjoys higher occupancy, which stood at 98.2% as of June 30, 2025 and generates better risk-adjusted returns.
Diverse Tenant Base and Contractual Rent Escalators: W.P. Carey’s portfolio is well-diversified by tenant, industry, property type and geography, aiding steady revenue generation. As of June 30, 2025, its top 10 tenants constitute 19.4% of ABR. Moreover, the existence of long-term net leases with built-in rent escalations yields stable cash flows. The company witnessed contractual same-store rent growth of 2.3% in the second quarter of 2025.
Expansionary Efforts: W.P. Carey has been capitalizing on growth opportunities. The total investment value for the second quarter stood at $548.6 million. In the second quarter of 2025, the company committed to funding new capital investments and commitments to the tune of $108.3 million, scheduled to be completed in 2027. During the same period, WPC sold 46 properties for gross sale proceeds of $364.2 million. Such match-funding efforts indicate the company’s prudent capital management practices and will relieve pressure from its balance sheet, which is encouraging.
Balance Sheet Strength: W.P. Carey has a healthy balance sheet position with ample liquidity. As of June 30, 2025, the company had a total liquidity of $1.7 billion, including around $1.3 billion of available capacity under its senior unsecured credit facility, $244.8 million of cash and cash equivalents and $135.2 million of cash held at qualified intermediaries. W.P. Carey’s share of pro rata net debt to adjusted EBITDA was 5.8X. The company also enjoys investment-grade ratings of BBB+ from S&P Global Ratings and Baa1 from Moody’s, rendering it favorable access to the debt market.
Steady Dividend Payouts: Solid dividend payouts are arguably the biggest enticement for investment in REIT stocks, and W.P. Carey remains committed to them. After reducing its dividend in December 2023 to 86 cents from the prior quarter's dividend payment of $1.07 as a result of the company’s strategic plan to exit its office assets, W.P. Carey increased its dividend four times, which is encouraging. Looking at the company’s operating environment and financial position compared to that of the industry, its current dividend is expected to be sustainable in the upcoming period.
The Zacks Consensus Estimate for TRNO’s 2025 FFO per share is pinned at $2.60, indicating year-over-year growth of 7.44%.
The Zacks Consensus Estimate for EQR’s 2025 FFO per share stands at $3.98, calling for an increase of 2.31% from the year-ago reported figure.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
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Key Reasons to Add W.P. Carey Stock to Your Portfolio Now
Key Takeaways
W.P. Carey’s (WPC - Free Report) mission-critical, single-tenant net lease commercial diverse portfolio, with contractual rent bumps, strategic portfolio repositioning and a healthy balance sheet, are key upsides.
Last month, WPC reported second-quarter 2025 adjusted funds from operations (AFFO) per share of $1.28, surpassing the Zacks Consensus Estimate of $1.23. The figure improved 9.4% from the year-ago quarter.
Results reflected higher revenues, aided by strong investment activity and a disciplined disposition strategy. WPC raised its full-year 2025 AFFO per share guidance.
However, analysts seem bearish about this Zacks Rank #2 (Buy) company, with the Zacks Consensus Estimate for its 2025 AFFO per share being revised southward by one cent over the past month to $4.87.
WPC shares have rallied 20.6% year to date, outperforming the industry’s growth of 2%.
Image Source: Zacks Investment Research
Factors That Make W.P. Carey Stock a Solid Pick
High-Quality, Mission-Critical Portfolio: W.P. Carey has one of the largest portfolios of single-tenant net lease commercial real estate in the United States, and Northern and Western Europe. The company invests in high-quality assets that are mission-critical for its tenants’ operations.
Through accretive expansions, renovations and follow-on deals, the company capitalizes on the existing tenant relationships by generating value-creation opportunities within its existing portfolio. As such, due to the inherent nature of its portfolio, the REIT enjoys higher occupancy, which stood at 98.2% as of June 30, 2025 and generates better risk-adjusted returns.
Diverse Tenant Base and Contractual Rent Escalators: W.P. Carey’s portfolio is well-diversified by tenant, industry, property type and geography, aiding steady revenue generation. As of June 30, 2025, its top 10 tenants constitute 19.4% of ABR. Moreover, the existence of long-term net leases with built-in rent escalations yields stable cash flows. The company witnessed contractual same-store rent growth of 2.3% in the second quarter of 2025.
Expansionary Efforts: W.P. Carey has been capitalizing on growth opportunities. The total investment value for the second quarter stood at $548.6 million. In the second quarter of 2025, the company committed to funding new capital investments and commitments to the tune of $108.3 million, scheduled to be completed in 2027. During the same period, WPC sold 46 properties for gross sale proceeds of $364.2 million. Such match-funding efforts indicate the company’s prudent capital management practices and will relieve pressure from its balance sheet, which is encouraging.
Balance Sheet Strength: W.P. Carey has a healthy balance sheet position with ample liquidity. As of June 30, 2025, the company had a total liquidity of $1.7 billion, including around $1.3 billion of available capacity under its senior unsecured credit facility, $244.8 million of cash and cash equivalents and $135.2 million of cash held at qualified intermediaries. W.P. Carey’s share of pro rata net debt to adjusted EBITDA was 5.8X. The company also enjoys investment-grade ratings of BBB+ from S&P Global Ratings and Baa1 from Moody’s, rendering it favorable access to the debt market.
Steady Dividend Payouts: Solid dividend payouts are arguably the biggest enticement for investment in REIT stocks, and W.P. Carey remains committed to them. After reducing its dividend in December 2023 to 86 cents from the prior quarter's dividend payment of $1.07 as a result of the company’s strategic plan to exit its office assets, W.P. Carey increased its dividend four times, which is encouraging. Looking at the company’s operating environment and financial position compared to that of the industry, its current dividend is expected to be sustainable in the upcoming period.
Other Stocks to Consider
Some other top-ranked stocks from the broader REIT sector are Terreno Realty (TRNO - Free Report) and Equity Residential (EQR - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for TRNO’s 2025 FFO per share is pinned at $2.60, indicating year-over-year growth of 7.44%.
The Zacks Consensus Estimate for EQR’s 2025 FFO per share stands at $3.98, calling for an increase of 2.31% from the year-ago reported figure.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.