Realty Income Corporation (O) holds a solid A- credit rating from S&P, positioning it three levels above the essential BBB- investment-grade benchmark. This strong rating underscores the company’s financial resilience and supports its appealing 5.3% dividend yield.
Robust Payout and Operational Metrics
In the third quarter of 2025, Realty Income reports an adjusted funds from operations (AFFO) payout ratio of 75%. This figure leaves a substantial 10-point margin before approaching the 85% threshold, which could signal potential risks to dividend sustainability.
The company’s portfolio demonstrates high performance with a 98.7% occupancy rate. Rent renewals have increased by 3.5%, reflecting strong tenant demand and consistent cash flow generation.
Conservative Leverage Supports Rating
Leverage metrics remain prudent at 5.4 times debt to EBITDA, staying comfortably below the 6.5 times level that might pressure the credit rating or dividend reliability. These factors collectively highlight Realty Income’s capacity to maintain its yield amid market fluctuations.
