Meet the 1 Stock I'd Buy With $5,000, Even If the Market Fell 10% Tomorrow
2026-09-29 12:23
•Will Healy •The Motley Fool
••••••• •••• Axe Cap view
Why Realty Income Might Be Worth $5,000 in Your Portfolio Now
Despite rising rates and a recent pullback, Realty Income's steady dividends and strong finances make it a rare buy in uncertain times.
Realty Income (O) has taken a hit lately, down around 18% from its highs as bond yields have climbed. But look beyond the surface: it still boasts a near-perfect occupancy rate and has raised its dividend for 32 years straight. Its payout ratio, measured by funds from operations (FFO), remains healthy, suggesting the monthly 5.4% yield isn’t a fluke. For South African investors, this REIT’s resilience highlights how stable income-generating assets can buffer volatility, unlike local shares sensitive to rand swings and economic shifts. Rising US rates could keep pressure on, and further hikes or economic slowdowns might challenge its tenants’ ability to pay rent. Yet, if you want income with capital preservation potential, Realty Income stands out. Just be aware this trade leans on the US dollar and interest rate trends, so rand strength or weakness will affect returns when converted back. this is just our opinion and not financial advice
I’d buy Realty Income on any meaningful dip, thinking of it as a steady income anchor amid market swings—especially if USD/ZAR stays stable or weakens. Avoid pulling out on short-term volatility unless fundamentals materially deteriorate.
- O
- USD/ZAR
- Further US interest rate hikes
- A sharp dollar strength hurting rand-based returns
6/10
The article recommends Realty Income (O), a REIT specializing in single-tenant commercial properties, as a compelling $5,000 investment even if the stock drops 10% shortly after purchase. Despite a recent 18% decline from its 52-week high due to rising interest rates, the company maintains a 99% occupancy rate, a 32-year dividend increase streak, and an attractive 5.4% dividend yield. Strong financial performance with 11% revenue growth and 47% net income surge in H1 2026 supports the sustainability of its monthly dividend payout.
Our take is based on reporting first published by The Motley Fool.