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Dividend Investing: Income & Growth Combined

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  Published in Stocks and Investing on Wednesday, January 21st 2026 at 12:07 GMT by The Motley Fool
      Locales: Texas, Pennsylvania, New York, UNITED STATES

The Enduring Appeal of Dividend Investing

Dividend investing offers a unique blend of current income and potential capital appreciation. For investors seeking a consistent income stream - retirees, those saving for a major purchase, or simply aiming for financial stability - dividend-paying stocks provide a tangible return beyond simple stock price fluctuations. However, the key differentiator between a short-term dividend play and a long-term investment lies in the company's underlying stability and commitment to shareholder returns.

Realty Income (O): The Monthly Dividend Champion

Realty Income, often affectionately dubbed "The Monthly Dividend Company," stands as a prime example of a business built for longevity. Operating as a Real Estate Investment Trust (REIT), Realty Income specializes in owning and managing freestanding retail properties. These aren't your typical sprawling shopping malls; they are single-tenant buildings housing essential businesses like pharmacies, quick-service restaurants, and grocery stores. This focus on essential retail provides a crucial layer of defense against economic volatility - these businesses often thrive even when consumer spending dips.

What truly sets Realty Income apart is its impressive track record. With 53 years in business, the company has consistently rewarded shareholders with increasing dividends for an astounding 27 consecutive years, earning it the prestigious title of Dividend Aristocrat. While past performance provides no guarantee of future success, Realty Income's consistency offers a compelling signal of its financial health and commitment to its investors.

Duke Realty (DRE): Benefiting from the Logistics Boom

Duke Realty represents a different, yet equally compelling, opportunity within the REIT sector. While Realty Income focuses on retail, Duke Realty specializes in industrial properties. This includes warehouses, distribution centers, and manufacturing facilities - the backbone of the modern supply chain. The rise of e-commerce has fueled unprecedented demand for industrial space, creating a favorable environment for Duke Realty's continued growth and profitability.

Like Realty Income, Duke Realty boasts a strong dividend history, having increased its payouts for 26 consecutive years. The company's business model benefits from long-term leases, providing predictable income streams and minimizing the risks associated with vacancy rates. This stability, coupled with the expanding demand for industrial space, positions Duke Realty as a solid choice for long-term dividend investors.

Why the Two-Decade Horizon? Key Attributes for Durability

Several factors converge to suggest Realty Income and Duke Realty's suitability for a 20-year investment horizon:

• Dividend Consistency & Growth: Both REITs demonstrate an unwavering commitment to rewarding shareholders with consistent and increasing dividend payments. This track record inspires confidence in their long-term financial management.
• Defensive Business Models: The focus on essential retail (Realty Income) and industrial properties (Duke Realty) provides a buffer against economic downturns and shifting consumer trends.
• Predictable Income Streams: Long-term leases are the cornerstone of both businesses, providing a reliable and predictable flow of income.
• Inflationary Hedge: Real estate, as an asset class, has historically served as an effective hedge against inflation. As inflation rises, rents and property values can adjust upwards, protecting and potentially enhancing investment returns.
• Adaptability: Both companies have demonstrated an ability to adapt to changing market conditions, crucial for maintaining long-term success.

Important Considerations and Disclaimer

While these companies present attractive opportunities, it's crucial to remember that all investments carry risk. Interest rate changes, economic slowdowns, and shifts in consumer behavior can impact REIT performance. Thorough due diligence and diversification remain essential components of a prudent investment strategy. The author holds shares of Realty Income (O) and Duke Realty (DRE). This is not financial advice and should not be taken as such; consult with a qualified financial advisor before making any investment decisions.