Canadians: 3 High-Yield REITs to Target in This Choppy Market

The turbulent market should spur Canadians to snag high-yield REITs like CT Real Estate Investment Trust (TSX:CRT.UN) right now.

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The S&P/TSX Composite Index was up 71 points in early afternoon trading on September 7. Energy was the only sector to suffer a steep loss at the time of this writing. That said, investors still have reason to be concerned about volatility in this uncertain market. Today, I want to zero in on three real estate investment trusts (REITs) that offer high-yield dividends. These REITs may be worth stashing for the consistent income they offer in this shaky period. Let’s dive in.

Here’s a dirt-cheap REIT that offers nice income

Allied Properties REIT (TSX:AP.UN) is a Toronto-based real estate investment trust (REIT) that is an owner, manager, and developer of urban work spaces in Toronto. Shares of Allied Properties have dropped 30% in 2022 at the time of this writing. That has pushed the stock into negative territory in the year-over-year period.

This company released its second-quarter (Q2) fiscal 2022 results on July 27. It delivered rental revenue growth of 11% to $154 million. Meanwhile, net income rose 1.5% to $100 million. EBITDA stands for earnings before interest, taxes, depreciation, and amortization. The measurement seeks to give a more accurate picture of a company’s profitability. Allied Properties delivered adjusted EBITDA growth of 10% to $101 million in the second quarter of fiscal 2022.

Shares of this REIT currently possess a very favourable price-to-earnings ratio of 7.3. It offers a monthly dividend of $0.146 per share. That represents a strong 5.6% yield.

Seek exposure to commercial properties through this top REIT

CT Real Estate Investment Trust (TSX:CRT.UN) is a Toronto-based REIT that owns income-producing commercial properties across Canada. Its shares have declined 4.6% in the year-to-date period. The stock is down 8.2% year over year.

Investors got to see this REIT’s second-quarter 2022 earnings on August 8. Property revenue increased 2.3% year over year to $132 million. Meanwhile, net operating income climbed 3.7% to $104 million. The company reported adjusted funds from operations (AFFO) of $66.6 million, or $0.28 per diluted share — up from $64.2 million, or $0.27 per diluted share, in the second quarter of fiscal 2021. It delivered AFFO growth of 3.3% to $131 million in the first six months of fiscal 2022.

This REIT last had a solid P/E ratio of 30, putting it in attractive value territory compared to its industry peers. It offers a monthly distribution of $0.072 per share, which represents a 5.3% yield.

One more undervalued REIT that boasts a high yield

Automotive Properties REIT (TSX:APR.UN) is the third and final REIT I’d look to snatch up in the first half of September. This Toronto-based REIT is focused on owning and acquiring primarily income-producing automotive dealerships properties across Canada. Its shares have dropped 7.8% so far in 2022.

In Q2 2022, Automotive Properties delivered rental revenue growth of 6.5% to $20.8 million. Meanwhile, AFFO jumped 3.8% to $11.4 million. It delivered net income growth of 37% to $60.8 million in the year-to-date period.

Shares of this REIT possess a very favourable P/E ratio of 6.4. It last paid out a monthly dividend of $0.067 per share, representing a tasty 5.9% yield.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Ambrose O'Callaghan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AUTOMOTIVE PROPERTIES REIT.

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