Company Overview - NNN REIT (NYSE: NNN) is a prominent player in the retail/service-oriented real estate property sector with approximately $10.8 billion in assets based on book gross value [1] - The company manages 3,568 properties across 49 states and has over 385 tenants, showcasing a well-diversified tenant structure [1] Investment Philosophy - The article emphasizes the importance of dividend investing as a pathway to financial freedom, highlighting its accessibility for investors [1] - The author shares insights from a professional background in M&A and business valuation, indicating a strong foundation in financial analysis and investment strategies [1] Sector Focus - The company’s focus spans various sectors including technology, real estate, software, finance, and consumer staples, which are also reflected in the author's personal investment portfolio [1]

NNN REIT (NNN 5.73%) has been a wealth-building machine over the years. The real estate investment trust (REIT) has increased its high-yielding dividend (currently 5.8%) for 35 straight years. That steadily rising income stream has enabled the REIT to deliver strong total returns over the past few decades. Its total shareholder return has averaged 11.1% annually during the last 30 years, exceeding the S&P 500's (^GSPC 0.03%) 10.5% return. That has enabled the REIT to grow a $1,000 investment made three deca ...

Financial Data and Key Metrics Changes - NNN REIT reported a 1.8% growth in core FFO for 2024, with core FFO per share at $3.32 and AFFO per share at $3.35, reflecting a 2.8% increase year-over-year [4][20] - The occupancy rate at the end of the fourth quarter was 98.5%, a decrease of 80 basis points due to challenges with two specific tenants [11][22] - The company ended the year with $860.6 million in annual base rent, accounting for all acquisitions and dispositions completed through year-end [22][33] Business Line Data and Key Metrics Changes - During the fourth quarter, NNN invested $217 million in 31 new properties, achieving an initial cap rate of 7.6% and an average lease duration of approximately 20 years [12][14] - Disposition activity was elevated, with nearly $150 million sold at a 7.3% cap rate, reflecting strategic and defensive asset sales [14][22] Market Data and Key Metrics Changes - The company anticipates a strong quarter of acquisitions in the first quarter of 2025, with a focus on assets related to Frisch's and Badcock Home Furnitures [10][11] - The competitive landscape is expected to tighten, with pricing for incoming deals projected to compress slightly compared to the fourth quarter [15][78] Company Strategy and Development Direction - NNN's strategy focuses on a bottom-up investment approach, aiming to deliver long-term value with below-average risk while maintaining a sector-leading average debt maturity of 12.1 years [5][33] - The company is committed to maintaining a light capital markets footprint while continuing to increase annual dividends and achieving mid-single-digit FFO growth per share over multiple years [5][32] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the leasing and recovery of properties previously leased to troubled tenants, with expectations of achieving better than historical recovery rates [30][31] - The company initiated 2025 core FFO guidance at a range of $3.33 to $3.38 per share, with expectations for acquisitions between $500 million to $600 million [31][32] Other Important Information - The company ended the year with no amounts outstanding on its $1.2 billion bank line, indicating a strong leverage and liquidity position [33] - Management highlighted the importance of maintaining a sound balance sheet and appropriate capital allocation to ensure sufficient returns on equity [35] Q&A Session Summary Question: Inquiry about AFFO guidance and lease termination impacts - Management noted that better-than-expected releasing outcomes for Frisch's and Badcock contributed to the AFFO guidance, with no major offsetting items impacting the growth number [41][44] Question: Details on transaction activity and tenant credit losses - Management indicated that 80% of deal flow in the fourth quarter came from relationships, with no significant changes in credit loss assumptions for 2025 [52][56] Question: Clarification on leasing and recovery rates for Frisch's and Badcock - Management confirmed that the leasing process is progressing faster than historical norms, with expectations of achieving better than the typical 70% recovery rate [62][68] Question: Discussion on the transaction market and competition - Management acknowledged elevated deal flow compared to last year, with increased competition primarily from private money seeking larger deals [74][78] Question: Concerns regarding specific tenants and credit watch lists - Management stated that while they maintain a credit watch list, there are currently no immediate concerns regarding tenant credit, and the 60 basis points of credit loss should adequately cover any exposure [90][92]

Core Insights - NNN REIT, Inc. reported a 1.8% growth in core FFO for 2024, with over $550 million in acquisition volume [4] - The company achieved a strong occupancy rate of 98.5% by the end of the year [4] - Dispositions of income-producing assets were executed at a cap rate 40 basis points lower than the acquisition yield, indicating strategic asset management [4] Financial Performance - The company has maintained a record of 35 consecutive years of annual dividend increases [4] - NNN REIT has a sector-leading weighted average debt maturity of 12.1 years, reflecting strong financial management [4] Strategic Positioning - The executive team has been strategically positioned for future growth, with an emphasis on maintaining a light capital structure [4]

For the quarter ended December 2024, NNN REIT (NNN) reported revenue of $218.35 million, up 1.5% over the same period last year. EPS came in at $0.82, compared to $0.53 in the year-ago quarter.The reported revenue represents a surprise of +0.34% over the Zacks Consensus Estimate of $217.6 million. With the consensus EPS estimate being $0.82, the company has not delivered EPS surprise.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to W ...

NNN REIT (NNN) came out with quarterly funds from operations (FFO) of $0.82 per share, in line with the Zacks Consensus Estimate. This compares to FFO of $0.82 per share a year ago. These figures are adjusted for non-recurring items.A quarter ago, it was expected that this retail real estate investment trust would post FFO of $0.84 per share when it actually produced FFO of $0.84, delivering no surprise.Over the last four quarters, the company has surpassed consensus FFO estimates two times.NNN REIT, which ...

Property Portfolio - NNN owned 3,568 properties with a total gross leasable area of approximately 36,557,000 square feet, achieving a 98% occupancy rate as of December 31, 2024[14]. - As of December 31, 2024, NNN owned 3,568 properties with a total gross leasable area of approximately 36,557,000 square feet and a weighted average remaining lease term of 10 years, with 98% of properties leased[43]. - NNN's properties are generally leased under long-term triple-net leases, allowing tenants to manage energy conservation and environmental programs[40]. - The average annual base rental payment for NNN's leases is $245,000, with payments ranging from $7,000 to $4,085,000[45]. - Approximately 57.3% of the annual base rent is generated from five retail lines of trade, including convenience stores (17.0%) and automotive service (16.9%)[64]. - 41.3% of the annual base rent is derived from properties located in five states: Texas (18.8%), Florida (8.7%), Illinois (5.1%), Georgia (4.5%), and Ohio (4.2%)[64]. - NNN's largest tenant sectors include convenience stores (17.0%), automotive service (16.9%), restaurants (16.2%), and family entertainment centers (7.2%), indicating a diversified property portfolio[153]. Financial Performance - Total revenues for 2024 were $869,266,000, a 5.0% increase from $828,111,000 in 2023[180]. - Rental revenues for 2024 were $848,657,000, up 5.1% from $807,327,000 in 2023, driven by recent property acquisitions[180]. - Total annualized base rent increased to $860,562,000 in 2024 from $818,749,000 in 2023, reflecting a growth of 5.1%[175]. - NNN declared dividends of $420,239,000 for 2024, an increase from $404,458,000 in 2023, with a per share dividend of $2.290 compared to $2.230 in the previous year[203]. - Cash provided by operating activities was $635,504,000, up from $612,410,000 in 2023[5]. - NNN had $9,062,000 in cash, cash equivalents, and restricted cash as of December 31, 2024, compared to $5,155,000 at the end of 2023[6]. Debt and Financing - As of December 31, 2024, NNN's total debt to total gross assets ratio was approximately 40%, and total debt to total market capitalization was about 37%[29]. - NNN's outstanding debt as of December 31, 2024, was $4,373,803,000, with no secured debt[87]. - NNN's credit facility had no outstanding balance as of December 31, 2024, with $1,200,000,000 available for future borrowings[205]. - The weighted average interest rate on NNN's credit facility was 6.25% for the year ended December 31, 2024, with a total borrowing capacity increased to $1,200,000,000[205]. - NNN's debt instruments contain various restrictive covenants that could limit operational activities and may result in defaults if not complied with[90]. - NNN was in compliance with all restrictive financial covenants as of December 31, 2024, which include leverage ratios and interest coverage[206]. Environmental and Sustainability Practices - The Corporate Sustainability Team was established in 2022 to enhance environmental stewardship and corporate governance practices[33]. - NNN actively monitors environmental conditions and requires tenants to comply with environmental laws, including remediation obligations[40]. - NNN maintains an environmental insurance policy covering substantially all properties to mitigate exposure to environmental liability[47]. - As of January 31, 2025, NNN had 66 properties under some level of environmental remediation and/or monitoring[48]. - NNN's properties are primarily located in Texas (18.8% of annual base rent), Florida (8.7%), and Illinois (5.1%) as of December 31, 2024[177]. Risks and Challenges - NNN may face challenges in executing its acquisition or development strategies due to competition and market conditions[63]. - NNN's financial condition may be adversely affected by changes in economic conditions, including inflation and tenant defaults[58]. - Cybersecurity risks could adversely affect NNN's business and expose it to liabilities[75]. - The presence of hazardous materials on properties could significantly impact NNN's results of operations and ability to distribute to stockholders[102]. - An epidemic or pandemic could disrupt NNN's tenants' ability to operate and pay rent, adversely affecting NNN's financial condition[115]. - Changes in governmental laws and regulations could impose significant costs on NNN and adversely affect its operations[110]. Management and Governance - NNN's management evaluates tenant creditworthiness through financial statements and performance metrics, ensuring a robust tenant selection process[152]. - The loss of key management personnel could negatively impact NNN's performance and the value of its securities[113]. - Compliance with REIT requirements may limit NNN's operational flexibility and affect its decision-making[107]. - If NNN fails to qualify as a REIT, it could face significant tax liabilities and penalties[105].

Exhibit 99.2 ANNUAL SUPPLEMENTAL DATA As of December 31, 2024 TABLE OF CONTENTS | | PAGE | | --- | --- | | Financial Summary | | | Income Statement Summary | 4 | | Funds From Operations (FFO) | 5 | | Core Funds From Operations (Core FFO) | 6 | | Adjusted Funds From Operations (AFFO) | 7 | | Other Information | 8 | | EBITDA | 8 | | Balance Sheet Summary | 9 | | Debt Summary | 10 | | Credit Metrics | 11 | | Credit Facility and Note Covenants | 11 | | Long-Term Dividend History | 12 | | Transaction Summary | | ...

ORLANDO, Fla., Feb. 11, 2025 /PRNewswire/ -- NNN REIT, Inc. (NYSE: NNN), a real estate investment trust, today announced operating results for the quarter and year ended December 31, 2024.  Highlights include: Operating Results: Revenues and net earnings, FFO, Core FFO and AFFO and diluted per share amounts: Quarter Ended Year Ended December 31, December 31, 2024 2023 2024 2023 (in thousands, except per share data) <td colspan="1" nowrap rowspan="1" he ...

As part of my investing strategy, I like to blend high-quality value stocks and growth stocks in my portfolio. That's because I believe the two can work together to help me to reach my long-term investment objectives.Hi, my name is Kody. Aside from my articles here on Seeking Alpha, I am also a regular contributor to Sure Dividend, The Dividend Kings, and iREIT+Hoya Capital. I have been investing since September 2017 (age 20) and interested in dividend investing since about 2009.Since July 2018, I have ran ...