Realty Income Raised Its 2026 AFFO Guidance. Here's What That Means for Its 5.2% Dividend.

Realty Income (O) raised its 2026 adjusted funds from operations guidance to $4.44-$4.45 per share, topping the consensus estimate of $4.37. The REIT reported second-quarter revenue above expectations and maintained a 98.8% portfolio occupancy rate.

The company increased its full-year investment guidance to $10 billion and announced a $1.4 billion joint venture to expand into the data center sector. The higher AFFO projection strengthens the foundation for continued dividend increases from the monthly-paying REIT, which currently yields 5.2%.

The guidance raise signals management confidence in the company's cash flow generation capacity despite a challenging rate environment. The data center pivot represents a strategic shift for the net-lease specialist, historically concentrated in retail and industrial properties. Strong occupancy and the aggressive $10 billion investment target suggest Realty Income sees opportunity to deploy capital accretively even as borrowing costs remain elevated.