Cohen & Steers Real Estate Opportunities Income Fund (RLTY) Stock

Cohen & Steers Real Estate Opportunities and Income Fund operates as a closed-end fund that aims to provide total returns through its exposure to REITs. The dividend yield sits at 8.2% and distributions are paid out on a monthly basis. The price trades at a discount to NAV, and interest rate cuts may serve as a positive catalyst for growth.

At the beginning of 2024, we predicted a rebound in real estate. RLTY earned a Strong Buy rating in June, driven by shifting interest rate sentiment and a discount to net asset value compared to peers. RLTY shares appreciated over 25% since June, outperforming the broader market and VNQ.

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The REIT rebound is in full swing, with likely rate cuts in the next six months. RLTY is one of four REIT focused CEFs from CNS, but has underperformed since launch in 2022. We explore key differences against the other funds in the lineup and why RLTY may outperform ahead.

The Cohen & Steers Real Estate Opportunities and Income Fund is trading at an attractive discount and provides exposure to the beaten-down real estate sector. The fund had a tough time shortly after its launch, but 2023 was much more kind to the fund, and the future looks brighter as well. RLTY's distribution rate comes to an attractive 9.32%, which is paid monthly to investors.

RLTY: Invest In The Best Real Estate Stocks In 2024

RLTY is a strong candidate for investment due to the potential for three interest rate cuts next year and its deep discount. The fund's performance has been market-beating and its discount has widened, indicating even better underlying performance. RLTY's underlying portfolio includes REIT investments and preferred securities, making it attractive in a lower interest rate environment.

Cohen & Steers Real Estate Opportunities and Income Fund focuses on REITs and is a young fund with potential for investors comfortable with leverage. REITs have been in a bear market since late 2021, with prices down about -35% on average. RLTY currently trades at a NAV discount of -13.4% and holds REITs with a history of solid dividend growth.