Realty Income Corp (O): Buy on the Dip

REITs have fallen out of investor’s favor quickly as fears that higher rates will suddenly render these investments useless. Realty Income Corp (O) focuses its investments on commercial real estate properties — a market that is likely to maintain growth as interest rates edge higher.
O shares enjoy the strong underpinnings of long-term technical support while having seen short-term selling pressure that has knocked it down to a technical support level at $46. Only 13% of the analysts covering the stock have it ranked a buy, signaling potential for upgrades to drive prices higher.
We expect the overreaction to the FOMC’s interest rate activity to result in higher prices for O and other REITs. With a target of $52, Realty Income has about 13% upside potential over the next three months.