ORLANDO, FL—National Retail Properties on Thursday said its second-quarter funds from operations was up 10% over the year prior, while FFO for the first half of 2015 increased 6.9% over the year-ago period. The single-tenant retail REIT increased its FFO guidance from a range of $2.14 to $2.17 to a range of $2.16 to $2.19 per share.

“With our recently announced dividend increase, 2015 will be the 26th consecutive year of annual dividend increases which is a long-term record that all of us at NNN are working to perpetuate,” says Craig McNab, the REIT's CEO. “Our team continues to source attractive retail properties for acquisition at excellent initial cash yields that will help us accomplish our objective.”

To that end, NNN in Q2 acquired 37 properties for a total of $147.8 million—a tally that “handily” exceeded the acquisition expectations of Daniel Donlan, managing director, equity research—REITs at Ladenburg Thalmann & Co. Inc. “Despite this volume beat, NNN has maintained ultra-low leverage of 4.4x net debt/EBITDA (5.8x with preferreds), which makes its future equity needs de minimus, especially given its near sector-low dividend/CAD payout ratio of 76%,” Donlan writes.

Nevertheless, he adds that with NNN trading at a 6.3% implied cash cap rate, “we see slightly better absolute and relative values elsewhere in the single-tenant sector.” Ladenburg Thalmann maintains a “neutral” rating on NNN's stock, although Donlan points out that the REIT's 4.7% current yield is “among the most secure in the group.”