The Fed shared that the key federal funds rate is expected to be kept in a target range between 5.25%-5.5%. As you can see from the US Inflation chart below, the inflation rate remained steady at 3.7% in September and October.
According to Fed Chair James Powell, his aim is to bring the US inflation down to 2%. This means that there can still be possibility ahead that the Fed increases the interest rate in the event the inflation rate doesn’t trend down on its own.
What does this mean for REITs? It means financial costs goes up, offsetting distribution. Of course the share price will once again react negatively. This means opportunities for dividend investors like me.
If you have missed the boat few weeks ago, fear not. The prices of certain REITs have not recovered or rallied higher enough.
Below is a list of REITs that I screened using my favourite stock screener from Stocks Café. Below are the criteria that I used to screen for dividend stocks. You can adjust them to fit your risk appetite.
Current Yield (%) >= 5 and <= 10
Price / Earnings <=20
Price / Book <= 3
Market Capitalization >= 1B
It is important for you to know that you should not buy the stock solely based on the current dividend yield. The screening only provide you a shorter list to analyse further.