Realty Income (O): 488 Consecutive Monthly Dividends

"Realty Income collects steady rental income from a growing portfolio of 2,500 retail properties. The company has been rock steady over the years, even in the face of some harsh commercial real estate downturns.

"Having a diverse portfolio that spans 32 industries and 49 states protects against a slump in any one sector or geographic area.

"And it helps to have reliable national chains such as Circle K, Taco Bell and PetsMart as tenants. Since it was founded in 1969, the firm's occupancy rates have never ended the year below 96%.

"And most of its properties are locked up under long 15-20 year leases without the baggage of mortgage debt, which means cash flows are predictable and highly visible.

"Better still, the properties are also rented under triple-net leases, in which the tenants (not the landlord) are responsible for property taxes, insurance and maintenance expenses.

"By itself, all of this should be enough to get income investors' attention. But if there's one thing better than a dependable dividend, it's a growing dividend.

"Since Realty Income first listed on the NYSE in 1994, the firm's portfolio has quadrupled in size and increased 813% in asset value. And a larger portfolio churns out a deeper stream of cash flows.

"Thanks to steadily rising FFO, shareholders have enjoyed 53 consecutive quarterly dividend hikes.

"It's hard enough to raise distributions once per year -- let alone four times per year. Right now, investors can look forward to $1.73 per share in annual payments.

"Consider this, if you had bought 1,000 shares on December 31, 2000, your initial stake would have cost $12,437.

"But since then, you would have collected $14,129 in total dividend payments. In other words, monthly dividends alone would have recouped all of your initial outlay -- plus a couple thousand more.

"Meanwhile, the $1,730 ($1.73 * 1000 shares) in current annual distributions would be throwing off a superb yield of 13.9% on your initial investment. And that's just half the picture.

"The shares haven't been sitting still over the years. They've climbed 22% over the past 12 months and now stand at an all-time high above $35.

"Realty Income likes to refer to itself as the "Monthly Dividend Company." And it certainly lives up to the billing. Investors have been showered with $1.9 billion in monthly dividends over the years.

"The current payout near 5.0% easily bests the 3.4% of its average equity REIT peer. And those lofty distributions are backed by some solid fundamentals (occupancy rate of 96.6%, 11.4 years remaining on the average lease, and built-in rate hikes).

"Realty Income should be bought more for its income than any capital gains potential. A highly reliable 5% payout is enticing in this low-yield environment.

"And hundreds of millions in recent acquisitions will soon boost cash flows and pave the way for meaningful dividend hikes this year.

"Action to Take --> This is a dependable stock for conservative investors. We are adding the wshares to our "Yield Maximizer" model portfolio."

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