Postal Realty Trust: A Steady Dividend Payer, Yielding Over 7%

Core Viewpoint - Postal Realty Trust (PSTL) is currently undervalued despite its strong dividend yield of over 7% and stable cash flows from leasing to the U.S. Postal Service (USPS) [3][4][9] Company Overview - PSTL holds approximately 6% of the leased market in the postal property industry, significantly outpacing the next 20 largest owners who collectively hold 11% [2] - As the only publicly traded operator in this niche market, PSTL is well-positioned to capture additional market share in the future [2] Financial Performance - PSTL has maintained a near 100% occupancy rate since its IPO, with a historical average lease retention rate that supports its stable cash flows [5][14] - The company has a conservative debt profile, with 94% of its debt being fixed rate and no significant debt maturities until 2027 [7][17] Dividend Information - PSTL has a history of reliable dividend payments, having previously increased its payout quarterly, though it now increases annually [8][18] - The dividend payout ratio is approximately 96%, which is higher than the sector average of 75% [18] Market Position and Valuation - PSTL's shares are currently trading at a cap rate of about 8.2%, while the company expects to acquire properties at a cap rate of 7.5% or above [7][20] - The stock is viewed as a "buy" due to its competitive moat, cash flow strength, and stable dividend payout, with a fair price estimated at $15.75 per share, indicating a potential upside of 16% from current levels [20]