Is it a good company at a reasonable price? It appears that you have to be careful of when you buy this REIT as not all 5 years periods give you close to an 8% total return. See the Total Return paragraph below. It is always good to buy stock over a period of years and in different months. The good thing about REITs is their good dividend yields, but they generally have low dividend growth if dividends grow at all. Currently my testing is showing that the stock price is at a reasonable level.
I own this stock of RioCan Real Estate (TSX-REI.UN, OTC-RIOCF). I bought this stock for diversification reasons. REITs tend to have low capital gains and high dividends. I first bought this stock in 1998 because I wanted to diversify my portfolio into REITs. It was a stock covered and recommended by MPL Communications in their Income Trust coverage. Over the years I have made several more purchases of this REIT.
When I was updating my spreadsheet, I noticed I have a total return of 9.30% per year with 0.24% from capital gains and 9.06% from distributions. I have had this stock for just over 28 years. I made a number of purchases over time in different accounts. They had lower revenue because of losses from equity-accounted investments, loss of investment properties and loss from other investments. This is all under Other Income (loss) section which was a net gain of $69,154M in 2024 and a net loss of $345,150M in 2025.
In the past year, all the officers I follow, including the CEO and CFO has bought shares over the past year. Also, of the directors I follow, the Chairman has bought shares over the past year. This is a positive. A problem I see is that there is far too many AFFO and FFO values from AFFO, Adjusted AFFO, and Core AFFO plus FFO, Adjusted FFO and Core FFO. I get a report from the TD on this stock and their AFFO and FFO values, including Adjusted and Core values do not always agree on what it was on the company’s statement for 2025, so it is hard to know their values for 2026.
If you had invested in this company in December 2015, for $1,018.67 you would have bought 43 shares at $23.69 per share. In December 2025, after 10 years you would have received $536.32 in dividends. The stock would be worth $804.10. Your total return would have been $1,340.42. This would be a total return of 3.53% per year with 2.34% from capital loss and 5.87% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $23.69 | $1,018.67 | 43 | 10 | $536.32 | $804.10 | $1,340.42 |
The current dividend yield is good with dividend growth restarted after a dividend decrease. The current dividend yield is good (5% to 6% ranges) at 6.04%. The 5, 10 and historical median dividend yields are good at 5.37%, 5.59% and 6.38%. Dividends were decreased in 2021 by 36%. They started to increase them again in 2022. They are still 20% below what they were in 2020. The last dividend increase was in 2025 and it was for 4.3%.
The Dividend Payout Ratios (DPR) are fine. The DPR for 2025 for Earnings per Share (EPS) is too high at 500% with 5 year coverage at 116%, but the FFO and AFFO ratios are the important ones. The DPR for 2025 for Adjusted Funds from Operations (AFFO) is good at 72% with 5 year coverage at 70%. The DPR for 2025 for Funds from Operations (FFO) is good at 70% with 5 year coverage at 61%. The DPR for 2025 for Cash Flow per Share (CFPS) is too high at 67% with 5 year coverage at 14%. The DPR for 2025 for Free Cash Flow (FCF) is too high at 99% with 5 year coverage at 88%. FCF varies in 2025 from $250.00 to $344.75 and I am using the latter one.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 500.00% | 115.98% |
| AFFO | 71.88% | 70.01% |
| FFO | 61.50% | 61.11% |
| CFPS | 67.40% | 69.76% |
| FCF | 98.79% | 88.84% |
Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2025 is high at 1.19 and currently at 1.16. However, we need also to look at the Long Term Debt/Covering Assets Ratio for 2025 which is good at 0.50 and currently at 0.50 because this is a important ratio for a REIT. The Liquidity Ratio for 2025 is good at 2.45 and 2.45 currently. The Debt Ratio for 2025 is good at 1.93 and 1.93 currently. The Leverage and Debt/Equity Ratios for 2025 are fine at 2.08 and 1.08 and currently at 2.08 and 1.08.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 1.19 | 1.16 |
| Lg Term R+A | 0.50 | 0.50 |
| Intang/GW | 0.00 | 0.00 |
| Liquidity | 2.45 | 2.45 |
| Liq. + CF | 2.94 | 2.93 |
| Debt Ratio | 1.93 | 1.93 |
| Leverage | 2.08 | 2.08 |
| D/E Ratio | 1.08 | 1.08 |
The Total Return per year is shown below for years of 5 to 32 to the end of 2025. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2020 | 5 | -4.40% | 8.31% | 2.23% | 6.08% |
| 2015 | 10 | -2.02% | 3.53% | -2.34% | 5.87% |
| 2010 | 15 | -1.21% | 5.33% | -1.08% | 6.41% |
| 2005 | 20 | -0.50% | 5.32% | -0.98% | 6.30% |
| 2000 | 25 | 0.28% | 13.85% | 2.79% | 11.06% |
| 1995 | 30 | 2.34% | 17.08% | 3.78% | 13.30% |
| 1993 | 32 | 3.22% | 13.73% | 3.12% | 10.61% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 23.42, 28.59 and 33.77. The corresponding 10 year ratios are 10.57, 11.65 and 12.73. The corresponding historical ratios are 11.23, 12.67 and 13.83. (Note the 5 year ratios are high because of lower EPS in the last 5 years.) The current ratio is 12.14 based on a stock price of $19.18 and EPS estimate for 2026 of $1.58. This ratio is between the median and high ratio of the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.
I also have Adjusted Funds from Operations (AFFO) data. The 5-year low, median, and high median Price/ Adjusted Funds from Operations Ratios are 10.81, 13.02, and 15.23. The corresponding 10 year ratios are 11.59, 14.27 and 15.57. The corresponding historical ratios are 13.68, 15.13 and 18.07. The current ratio is 12.06 based on a stock price of $19.18 and AFFO estimate for 2026 of $1.59. This ratio is between the low and median ratio of the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I also have Funds from Operations (FFO) data. The 5-year low, median, and high median Price/Funds from Operations Ratios are 9.34, 11.25 and 13.16. The corresponding 10 year ratios are 10.40, 12.72 and 14.62. The corresponding historical ratios are 10.68, 12.73 and 15.08. The current ratio is 11.77 based on a stock price of $19.18 and FFO estimate for 2026 of $1.63. This ratio is between the low and median ratio of the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a Graham Price of $29.90 using FFO in the equation. The 10-year low, median, and high median Price/Graham Price Ratios are 0.56, 0.69 and 0.81. The current P/GP Ratio is 0.64 based on a stock price of $19.18. The current ratio is between the low and median ratios of the 10 year median ratios.
I get a 10-year median Price/Book Value per Share Ratio of 0.88. The current ratio is 0.79 based on a Book Value of $7,157M, Book Value per Share of $24.37 and a stock price of $19.18. The current ratio is 10% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a 10-year median Price/Cash Flow per Share Ratio of 14.52. The current ratio is 12.98 based on Cash Flow for the last 12 months of $434M, Cash Flow per Share of $1.48 and a stock price of $19.18. The current ratio is 11% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get an historical median dividend yield of 6.38%. The current dividend yield is 6.04% based on Dividends of $1.158 and a stock price of $19.18. The current dividend yield is 5% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.
I get a 10 year median dividend yield of 5.59%. The current dividend yield is 6.04% based on Dividends of $1.158 and a stock price of $19.18. The current dividend yield is 8% above the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.
The 10-year median Price/Sales (Revenue) Ratio is 5.52. The current P/S Ratio is 4.67 based on Revenue estimate for 2026 of $1,206M, Revenue per Share of $4.11 and a stock price of $19.18. The current ratio is 15% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
Results of stock price testing is that the stock price is reasonable and below the median. The 10 year dividend yield test says this and it is confirmed by the P/S Ratio test. Most of the other testing is saying the same thing.
When I look at analysts’ recommendations, I find Strong Buy (4), Buy (5), Hold (2) and Underperform (1). The consensus is a Buy. The 12 months stock price consensus is $21.48 with a high of $22.75 and a low of $20.00. The consensus stock price of $21.48 implies a total return of 18.03% with 11.99% from capital gains and 6.04% from dividends based on a current stock price of $19.18.
There are only analysts’ comments for 2025 on Stock Chase . The last two are Do Not Buy and one said that this was because they were in the retail space. Others are mostly Holds and a couple of Buys. Amy Legate-Wolfe on Motley Fool says to buy CDN REITs for income, including this one. Demetris Afxentiou on Motley Fool says if you want real estate exposure without the costs and complexities of ownership, buy this stock. The company put out a Press Release for its fourth quarter of 2025 results.
Simply Wall Street via Yahoo Finance reviews this stock rather negatively. Simply Wall Street gives this stock one and one half stars out of 5. They list 4 risks of interest payments are not well covered by earnings; unstable dividend track record; large one-off items impacting financial results; and profit margins (5.6%) are lower than last year (35.4%).
RioCan Real Estate Investment Trust is a Canadian real estate investment trust which owns, develops, and operates Canada's portfolio of retail-focused, increasingly mixed-use properties. The REIT's property portfolio includes shopping centers and mixed-use developments, with majority of its properties located in Ontario, Canada. The company's tenants consist of grocery stores, supermarkets, restaurants, cinemas, pharmacies, and corporates. Its web site is here RioCan Real Estate.
The last stock I wrote about was about was Bombardier Inc (TSX-BBD.B, OTC-BDRBF) ... learn more. The next stock I will write about will be TFI International Inc (TSX-TFII, OTC-TFIFF) ... learn more on Monday, March 23, 2026 around 5 pm.
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