Key Takeaways
- NNN REIT yields 6.0% after raising its dividend 3.3% in October, and Mid-America Apartment Communities yields 5.2% after lowering its 2026 guidance in late October.
- NNN REIT’s dividend took 69% of its AFFO in fiscal 2025, and analysts expect 68% in 2026, against 80% and 83% for Mid-America.
- Mid-America grew its dividend 8.6% a year from fiscal 2020 to fiscal 2025, against 2.7% for NNN REIT, but most of that came from one big raise in fiscal 2023.
- Mid-America’s management expects next spring’s leasing season to show whether rents are recovering, and NNN REIT has a $350 million bond to refinance in December.
NNN REIT (NNN) raised its quarterly dividend 3.3% to $0.62 a share on Oct. 15. That’s its 37th consecutive annual increase, and at today’s prices it’s a 6.0% yield.
Mid-America Apartment Communities (MAA) had a rougher October. In its Oct. 28 report, the apartment owner lowered its 2026 outlook because a wave of new apartments in markets like Phoenix and Charlotte keeps pushing down rents on new leases. Its dividend held at $1.530 a quarter, a 5.2% yield.
Both are REITs, so I’ll judge each dividend on its AFFO payout ratio. For an investor who wants a high yield, which one is the better buy?
| Metric | NNN REIT (NNN) | Mid-America (MAA) |
|---|---|---|
| Forward yield | 6.0% | 5.2% |
| Dividend growth, fiscal 2020-2025 | 2.7% a year | 8.6% a year |
| AFFO payout ratio, fiscal 2025 | 69% | 80% |
| AFFO payout ratio, fiscal 2026 (consensus) | 68% | 83% |
| Net debt/EBITDA (LTM) | 5.67x | 4.72x |
| Interest coverage (LTM) | 2.75x | 2.81x |
Source: TIKR, at today’s prices.
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NNN REIT keeps raising, with room to spare
NNN’s business is still growing. Third-quarter AFFO rose 5.8% from a year earlier to $0.91 a share. Management also kept its 2026 AFFO guidance of $3.55-$3.59 a share, up from $3.44 in fiscal 2025.
That leaves a well-covered dividend. NNN paid out 69% of its AFFO in fiscal 2025, and its ratio has stayed between 67% and 69% every year since fiscal 2021. AFFO per share rose in every year but one, from $2.41 in fiscal 2016 to $3.44 in fiscal 2025, and the dividend has followed it up:
The one bad year was fiscal 2020. AFFO per share fell from $2.80 to $2.51, and the payout ratio jumped to 82.5%. NNN raised its dividend anyway, from $2.03 to $2.07 a share. “We’ve operated in high interest rate cycles, low interest rate cycles,” CFO Vincent Chao said on the third-quarter call. “And so all of that has allowed us to continue to raise that dividend year in, year out regardless of what’s going on around us.”
The risk is debt. NNN carries more of it than MAA, and it has to refinance a $350 million bond in December as rates rise.
Mid-America’s AFFO is headed the other way
MAA’s dividend has grown much faster than NNN’s, though its cash flow hasn’t kept up lately. The dividend rose from $4.03 a share in fiscal 2020 to $6.08 in fiscal 2025. Most of that came in one step, from $4.67 in fiscal 2022 to $5.67 in fiscal 2023.
Over the same stretch, AFFO per share fell from $8.24 in fiscal 2023 to $7.61 in fiscal 2025, and consensus expects $7.41 for 2026. The payout ratio rose from 69% in fiscal 2023 to 80% in fiscal 2025. Analysts expect 83% this year, a tighter fit than NNN’s:
The cause is rent on new leases, which fell 6.0% in the third quarter. On Oct. 28, MAA cut the midpoint of its same-store revenue guidance by 35 basis points to -0.25%.
Existing residents are holding up better, with renewal rents up 5.3%. CEO Brad Hill doesn’t expect a turn before spring, though: “It’s really going to be the spring leasing season before you see that.”
So which dividend wins?
NNN REIT is the better high-yield dividend stock. It pays the bigger check today, 6.0% against 5.2%, and it keeps more AFFO behind that check. Its AFFO is still growing while MAA’s is shrinking.
MAA’s faster record doesn’t change that. At its 8.6% five-year rate, $10,000 in MAA would out-earn the same $10,000 in NNN by about 2029. It would pay about $1,090 in year 10, a 10.9% yield on your cash today. But most of that rate came from fiscal 2023’s single big raise. At each dividend’s pace now, MAA’s income never catches up: about $787 from NNN in year 10, against about $661 from MAA.
NNN is also cheap against its own history. It trades at 11x forward AFFO, against a five-year average of 13x and a high of 16x in January 2022:
None of this puts MAA’s dividend at risk. It carries less debt, its renewing residents are paying more, and management expects fewer new apartments to be delivered in 2027 than the long-term average. But NNN has a decade of steady coverage behind every raise.
Of course, a strong spring for MAA would change the comparison, and NNN still has that December bond to refinance.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
