1 More Big Dividend Company Worth Exploring
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1 More Big Dividend Company Worth Exploring

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Companies that pay big dividends often make for some of the best investments, and there is one giant that at first glance has a lot to like about it, and may be a worthy place to park your money ...

Companies that pay big dividends often make for some of the best investments, and there is one giant that at first glance has a lot to like about it, and may be a worthy place to park your money today.

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1 More Big Dividend Company Worth Exploring 1 More Big Dividend Company Worth Exploring Presentation Transcript

  • 1 More Big Dividend Company Worth Exploring
  • An intriguing business One of the first things that piqued my attention in CoreSite Realty was not just that it was a REIT like Realty Income, but the business it finds itself in. Instead of leasing out to various companies for retail purposes, it instead owns 16 data centers and provides companies access to its properties and corresponding technology.
  • An intriguing business Seemingly, not a day goes by without some firm announcing it is upgrading to cloud-based technology, or a report comes out about the coming big-data revolution. Undeniably there will likely be technology companies which see massive growth as a result. Image Source: Flickr / John McStravick.
  • An intriguing business But the fact CoreSite Realty provides the property and solutions which make all of this possible -- and itself isn’t a technology company -- means it is exposed to less risk since it holds a secondary place in the industry. While it may not provide the massive upside of technology companies, it also provides much less risk.
  • Impressive Results Not only is the industry it finds itself in attractive, but more importantly, its actual operating results are as well. As shown in the chart below, its core funds from operations have continued to rise and since it went public:
  • Impressive Results And when considering the adjusted funds from operations of $0.51 per share in the second quarter, versus the $0.25 seen in the fourth quarter of 2010, it has watched its earnings rise at a staggering annual rate of 23%. All of this is to say, it doesn’t simply operate in an attractive industry, but it also has executed incredibly well.
  • Reasonable Valuation The final thing worth noting about CoreSite Realty is its reasonable valuation. It noted in its latest earnings release it expects its full year funds from operations (FFO) to stand between $2.07 and $2.15. Meaning at today’s price hovering around $34.50 it’s trading at a multiple of roughly 16.7 Price / FFO.
  • Reasonable Valuation This is the almost identical multiple Realty Income was trading at in June, meaning its valuation is surprisingly reasonable. Although it is undoubtedly trading at a higher cost relative to some of the other REITs, its impressive growth and prospect for future growth would warrant a higher valuation.
  • REITs are so attractive is because the smartest investors know dividend stocks crush non-dividend paying ones over the long term. And we’ve found great dividend stocks for you!