It’s astounding how many solid companies are out there, that continue to trade well in this bear market, and yet still remain of value. And some of these even include dividend stocks. One of the best to consider right now is dividend stock Slate Grocery REIT (TSX:SGR.UN).
Today, I’m going to narrow my focus on this REIT to show how investors can benefit from picking up this dividend stock today.
Source: Getty Images
Strong performance
First off, let’s get right into the third quarter results. Slate Grocery stock reported those results this month, and they were as strong as ever. The REIT managed to maintain its lease agreements, occupancy, and cash flow for the quarter.
Occupancy remained at 93.1% for the quarter, with adjusted funds from operations coming in at $0.24, up $0.01 from the year before. Further, it managed to increase its leasing spread. The dividend stock believes it will continue to merge the fragmented grocery real estate market, with two strategic dispositions at $19 million made during the quarter.
Shares are rising
Slate Grocery REIT continues to come out ahead of earnings estimates and remains a solid buy recommendation by analysts. And investors seem to agree. The dividend stock is one of the few out there that has seen shares actually increase this year, rather than fall.
Shares of Slate Grocery stock are up 11.5% year-to-date. Furthermore, since earnings came out this month, shares jumped 6% in that time. And yet, there is still so much value to unlock here.
This dividend stock currently trades at just 5.61 times earnings, putting it well within value territory at the moment. It also continues to have a strong balance sheet. Finally, even though shares are up this year, they remain below 52-week highs. So, you get a deal in every sense of the word.
Ah, the dividend
You’re likely here for the dividend, which is the main reason you’ll want to consider Slate Grocery REIT. This dividend stock currently offers a 7.86% yield. That’s astoundingly high, and yet remains solid given its recent performance. There’s really no reason that the REIT won’t continue to pay out these rates and continue increasing it.
In the last five years alone, Slate Grocery stock has increased its dividend at a compound annual growth rate (CAGR) of 1.95%. Sure, this may not seem that high, but it’s consistent. You want to keep seeing growth, and you’ll get that with this stock.
Bottom line
If you put it all together, you could see massive returns and passive income from this dividend stock in the next year. Should shares reach their 52-week highs, a $5,000 investment would turn into $5,821. Furthermore, you’ll lock in annual dividends of about $392 as of this writing. All said and done, that’s a combined return of $1,213 to add to your portfolio in just one year. Not bad for one little grocery dividend stock, don’t you think?
