If You Invested $10,000 In VICI Properties Five Years Ago, Here's How Much You Would Have In Dividends Today

When considering purchasing dividend stocks, investors often look at an issue's total return over time. But the total return is not just about the price today versus the price an investor originally paid for the shares. Total return includes any share price appreciation plus the dividends received and the return may differ, depending on whether the investor collects or reinvests the dividends.

It should also be noted that dividends paid often vary over time. Many investors focus on dividend yield, but the dividend growth record and whether the payments are consistent are equally as important.

Take a look at one real estate investment trust (REIT) that has proven itself to be an excellent investment over the past five years, both for appreciation as well as dividend growth and regular payments.

VICI Properties Inc. VICI is a New York-based diversified experiential REIT that specializes in owning and operating gaming, hospitality and entertainment properties. Its triple-net portfolio includes well-known Las Vegas hotels such as Caesars Palace, MGM Grand and the Venetian Resort.

VICI Properties was formed as a REIT in 2017 and was a spinoff from Caesars Entertainment Operating Co. as part of a Chapter 11 reorganization. The initial public offering (IPO) was held on Feb. 1, 2018. Vici Properties' portfolio consists of 54 gaming and 38 nongaming facilities with 60,300 hotel rooms and over 500 restaurants, bars, nightclubs and sports books.

If you invested $10,000 in VICI Properties five years ago, you would have received 457.04 shares at $21.88 per share. The quarterly dividend at the time was $0.29 per share.

Over the past five years, the quarterly dividend has been raised five times and has grown 44.82% to $0.42 per share. The dividend has never been cut or suspended — even during the worst of the COVID-19 pandemic. VICI Properties increased its dividend in September 2020 from $0.30 to $0.33 per share.

During those five years, you would have received $6.79 in dividends, and your shares would have appreciated 30.98% to $28.66. Your Vici Properties shares would now be worth $16,203.56 and the total gain would be 62.02%.

If you had chosen to reinvest the dividends, you would now own 593.81 shares. The value of those shares would be $17,020.92 and the total return would be 70.19%. 

On Sept. 7, VICI Properties increased the quarterly dividend from $0.39 to $0.42. Often when a company increases its dividend, it can be a tipoff that the next earnings report will be solid. This was the case on Oct. 25, when VICI Properties announced its third-quarter operating results. Funds from operations (FFO) of $0.54 per share beat the estimates of $0.53 per share and was 10.2% better than FFO of $0.49 per share in the third quarter of 2022. Revenue of $904.32 million beat the estimates of $902 million and trounced third-quarter 2022 revenue of $751.5 million.

As for analyst views, on Oct. 16, JMP Securities analyst Mitch Germain maintained a Market Outperform rating on VICI Properties, while lowering the price target from $38 to $34.

On Oct. 19, VICI Properties announced it had completed an acquisition of 38 bowling entertainment centers in a sale-leaseback arrangement with Bowlero Corp. BOWL. The purchase price was $432.9 million, and the cap rate on the 25-year lease term is 7.3%. In acquiring these assets, VICI Properties continues to expand its diverse portfolio to make the bowling centers accretive to earnings in 2024.

With a payout ratio of 68% and an FFO that continues to grow, VICI Properties could easily continue to reward its investors with further appreciation and dividend hikes in the future.

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