Omega (OHI) Raises Dividend - Add It To Your Portfolio?

Delighting its shareholders, Omega Healthcare Investors, Inc. (NYSE:OHI) revealed a 3.4% hike in its quarterly cash dividend on Thursday. The company will now pay a dividend of 60 cents per share, up from 58 cents paid earlier. The increased dividend will be paid on Aug 15, 2016 to shareholders of record as on Aug 1, 2016.

Based on the increased rate, the annual dividend comes to $2.40 a share, resulting in an annualized yield of about 7.12%, considering Omega’s closing price of $33.69 on Jul 15. Given that the company’s dividend yield surpasses the industry average of 4.43%, the stock is likely to draw rising investors’ attention ahead.

In fact, solid dividend payouts are arguably the biggest enticement for REIT investors and this represents Omega’s sixteenth consecutive dividend raises, reflecting the company’s consistent efforts to increase shareholders’ wealth.

No doubt, Omega has its solid fundamentals to back dividend hikes. This real estate investment trust (REIT) focuses on investing in and providing financing to the long-term care industry. As of Mar 31, 2016, Omega’s portfolio of investments included more than 900 properties situated in 42 states and the U.K., and operated by 83 operators.

In fact, the company has been a steady performer, beating the Zacks Consensus Estimate in each of the past four trailing quarters with an average surprise of 4.26%. Omega’s ROE is 5.82%, which is also considerably higher than the industry’s ROE of 3.54%. Further, the company has current cash flow growth of 31.66%, which should help the company to sustain its dividend payout to equity investors. It’s also very liquid, with a current ratio of 2.71.

Omega presently has a Zacks rank #2 (Buy). Investors interested in the REIT industry can also consider stocks like Boston Properties Inc. (NYSE:BXP) , Mack-Cali Realty Corp. (NYSE:CLI) and Ventas, Inc. (NYSE:VTR) . Each of these stocks has the same Zacks Rank as Omega.