Ahead Of The Bell: Realty Income Downgraded

NEW YORK (AP) — Recent gains in Realty Income Corp.'s stock price have brought the shares to a level that reflects its strong balance sheet and other positives, a Janney Montgomery Scott analyst said Friday as he downgraded it to "Neutral" from "Buy."

Shares are up 33.5 percent since July 10, when the stock dipped to its lowest point since May, and have risen nearly 86 percent since March.

Shares dipped 63 cents, or 2.4 percent, to $26 in premarket trading.

Analyst Andrew DiZio has a $26.50 target price on the real estate investment trust, which develops commercial properties and leases them to retail chains.

The current price accurately reflects the company's value, he said in a note to investors: It doesn't have any debt due before 2013, its balance sheet is strong and its leasing practices leave it less vulnerable to tenant bankruptcies than some of its competitors, he said.