Summary

• Getty Realty Corp. has outperformed peers, up nearly 20% year-to-date, and offers a 5.8% dividend yield and consistent AFFO growth.
• GTY raised full-year AFFO guidance to $2.50–$2.52, reflecting strong investment activity and robust portfolio fundamentals with 99.7% occupancy.
• The REIT trades at a forward P/AFFO of 13x, below the peer average, with potential for re-rating to 14x–16x as economic clarity improves.
• I maintain a buy rating for GTY, emphasizing its strong balance sheet, stable fundamentals, and attractive valuation for long-term income investors.
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Introduction

The REIT (XLRE) sector has been quietly outperforming, slightly outpacing the S&P (SP500), up close to 9% compared to a little over 8% for the index at the time of writing.

While REITs should be primarily viewed as long-term total return vehicles, I believe the sector could come under pressure in the near term due to long-term treasury volatility as inflation worries grow.

However, this weakness should be viewed as a buying opportunity, as many REITs still trade at attractive valuations compared to the overall market.

One REIT I believe fits that description is Getty Realty Corp. (GTY), a REIT I've been bullish on for some time and has quietly outperformed.

In this article, I discuss Getty Realty's latest earnings, fundamentals, and why- despite the potential to see near-term volatility, the stock remains attractive for long-term income-focused investors.

Previous Buy Thesis

I last covered Getty Realty Corp. back in December in an article titled: A Quality REIT I Think Mr. Market May Be Mispricing.

Since then, Getty's share price has begun catching up to their fundamentals, with them outperforming the index by a sizable margin. Shares rallied close to 18% compared to roughly 10% in the past 5 months.

During Q3 earnings, GTY saw an acceleration in investment activity. Through the first 3 quarters, investment activity of $237 million exceeded the prior year's fiscal year total of $209 million.

Management's strong execution to raise full-year AFFO guidance and raise the dividend 3.2% to $0.485. Still, I believed the market was mispricing them due to their portfolio tenant concentration at a forward P/AFFO multiple of just 11.73x.

Share Price Catching Up To The Fundamentals

Getty Realty Corp. reported their Q1 earnings this past April, with AFFO exceeding analysts' estimates by a penny. This amounted to $0.63 and rose nearly 7% from the year prior. Realty Income's (

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Analyst’s Disclosure: I/we have a beneficial long position in the shares of ADC either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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