Cold Storage King’s Fat Yield Makes the Stock a Bargain

Americold Realty Trust (NYSE: COLD) is behind the scenes of many of your daily consumables, from medications and vaccines to standard grocery store fare, such as strawberries and ice cream.

Better yet, the cold storage titan has a juicy 5.4% dividend yield that shines even in the historically higher-yielding REIT sector. 

Trading at a substantial discount to its $31 fair value, the current sub-$20 price is a screaming deal, even after a rough first quarter in 2025. 

With prime warehouses and a consolidation play, Americold’s poised to dominate the $20 billion cold storage market, dishing out steady cash for income-hungry investors.

Next Crypto Boom (Sponsored)

What the Smartest People in Crypto Are Doing Right Now

ETFs are flooding crypto markets with institutional capital, and a new wave of opportunity is just beginning.

While most are focused on Bitcoin, 27 of the most trusted crypto insiders are tracking where the smart money is really going.

Their findings will be revealed during the Crypto Community Summit 2025, and access is currently free.

Expect key predictions, altcoin picks, and the next phase of growth few are prepared for.

[Claim Your Free Summit Pass Now]

Cold Storage Boom Fuels Food Supply Chains

Cold storage makes off-season fruits and veggies available nationally, among other key logistical tasks, and Americold’s riding a red-hot demand wave. 

The global cold storage market, worth $150 billion, is growing 8% a year through 2030 as Americans eat 2% more food annually.

With 96% of perishables passing through these icy vaults, the need’s undeniable. 

Urbanization, with 85% of folks now city-dwellers, and a 10% surge in organic food sales, cranks up demand for warehouses near metro hubs.

Even as inflation has Americans pinching their wallets, food’s a gotta-have-it staple, shielding Americold from the worst. 

Private equity’s tossing $5 billion into new facilities, risking oversupply, but Americold’s prime spots in Chicago and L.A. keep it ahead.

The REIT sector’s 5% yearly growth through 2030, as per NAREIT, fuels Americold’s long-term prospects.

One Asset Thrives in Chaos (Sponsored)

The Trump-Elon War Could Trigger an Economic Collapse - Here's Your Only Safe Exit

Markets are on edge as tensions rise between two of America’s most powerful figures—Trump and Musk.

With inflation rising, banks pulling back, and stocks swinging wildly, retirement accounts are more exposed than ever.

But one asset class has quietly gained value during every major crisis: physical gold.

Discover how to protect wealth and roll over eligible accounts into gold—without paying taxes or penalties.

CLAIM YOUR FREE GOLD IRA GUIDE NOW

The window to protect your wealth is closing fast. Act now before the next headline sends markets into freefall.

Operational Overview and Recent Earnings

Americold’s strength comes from its network of 250 frost facilities, chilling everything from berries to biologics.

These facilities, mostly in North America, generate 90% of revenue from rent and storage, with the rest from trucking and managing third-party sites. 

To be fair, Q1 2025 hit a sour note, with adjusted funds from operations slipping 9% to $0.34 per share, as high inventory from last year and soft food volumes took a toll.

Core EBITDA, a steadier gauge, fell 5% to $140 million, per a May 8, 2025, update. 

Same-store occupancy dropped 4% to 76.6%, dragging rent revenue down 4% to $340 million, while facility costs crept up 2%, slicing net operating income by 6%.

Management slashed 2025 AFFO guidance to $1.42-$1.52, a 5% cut, blaming inflation and a wobbly economy. 

Yet, a 5% dividend hike to $0.23 quarterly kept free cash flow humming at $50 million, flat from last year, signaling resilience amid the chill.

Top AI Stocks (Sponsored)

Discover 9 AI Stocks Poised to Explode

Trade restrictions on AI chips are shaking up the global tech landscape.

Nvidia’s exposure to China is turning into a multi-billion-dollar problem—while a new wave of U.S.-based AI companies is quietly moving in.

These under-the-radar players combine advanced AI capabilities, domestic manufacturing, and strong revenue momentum. 

Their edge? Readiness to capitalize on shifting policy winds.

Get the free report: “Top 9 AI Stocks for This Month”

Dividend Profile

Americold’s dividend is a cash machine, pumping out $0.23 quarterly, or $0.92 yearly, for a mouthwatering 5.4% yield at today’s pricing.

A 5% hike in 2025, riding a wave of mid-single-digit raises, proves it’s built to last. 

With a 60% payout ratio backed by $200 million in annual AFFO, and Q1’s $50 million free cash flow holding steady, the dividend’s rock-solid.

Occupancy gains and cost cuts could fuel 4-6% hikes, making Americold a dream for income chasers.

Bear Case

• Trouble’s brewing if tariffs crush spending, potentially slashing volume. 

• Private-label warehouses could lure tenants away. 

• Labor shortages might jack costs, pinching margins. 

• Private equity’s building spree risks rent pressure from oversupply.

• Big players like Conagra (NYSE: CAG) going solo could gut demand. 

• eCommerce’s sluggish grocery shift might cap growth despite high expectations for the sector.

Americold’s High-Yield Bargain Sparks Steady Cash

Americold’s Q1 2025 took a hit, with a 9% AFFO drop and 76% occupancy exposing its soft spots. Yet, trading below fair value, it’s a steal screaming for attention. 

A 3% NOI growth forecast, fueled by $20 billion in U.S. cold storage demand and 8% development yields, taps a $150 billion global market.

With $920 million in liquidity and $3.4 billion debt at 5 times EBITDA, Americold’s got the muscle to push service margins to 12% by 2029. 

A 5.4% yield and 49% revenue from top clients like Unilever (NYSE: UL) lock in cash flow.

Overcapacity could sting if new builds flood the market, but Americold’s scale and savvy keep it ahead.