Treasuries Yield 4.75%—Does Realty Income’s Monthly Dividend Still Make Sense?

Realty Income (O) scores an A-minus on its dividend, with a 5.03% yield sitting just 28 basis points above the 4.75% Treasury rate.

AFFO per share grew 3.8% in Q2 with a full-year midpoint of $4.44, putting the payout ratio at a comfortable 73%.

A $6 billion hyperscale data center joint venture with Cloud Capital gives Realty Income a growth angle pure net-lease peers cannot match.

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Realty Income ( NYSE:O ) is set to pay shareholders again. The self-styled Monthly Dividend Company is distributing $0.271 per share on September 15, 2026, its 674th consecutive monthly dividend. That streak, combined with 115 consecutive quarterly increases and 133 total hikes since its 1994 NYSE listing, is the résumé investors buy into. The question for a scorecard: does the payout still deserve top marks with the 10-year Treasury at 4.75%?

The September check works out to an annualized forward dividend of $3.252, up in small monthly steps from $0.2695 as recently as October 2025. At a share price of $61.56, that pencils out to a 5.03% yield. Against a 4.75% risk-free rate, the income premium is just 28 basis points. Historically, O has offered a wider cushion, and that compression is the single biggest reason its grade is under pressure.

GAAP optics look ugly: Q2 EPS of $0.37 missed the $0.42 estimate, and full-year net income guidance of $1.59 to $1.60 sits well below the dividend. For a REIT, though, AFFO is the right yardstick. AFFO per share grew 3.8% to $1.09 in Q2, and management raised the full-year midpoint to $4.44 to $4.45. That puts the AFFO payout ratio near 73%, leaving comfortable coverage and reinvestment capacity.

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