Net Lease REITs 2Q26 Preview

Research evidence excerpt

Net Lease REITs 2Q26 Preview

Equity Research

Price Target Change — July 15, 2026

Net Lease REITs

Volumes and Credit Both Sources of Upside for the Group

Our Call John Kilichowski

Overall, we tilt slightly more constructive on Net Lease into 2Q earnings, with room Equity Analyst | Wells Fargo Securities, LLC

John.Kilichowski@wellsfargo.com | 212-214-5311

for AFFO guidance bumps on continued strength in the transaction market, along with

James Feldmanupside from better than expected credit loss. See more inside.

Equity Analyst | Wells Fargo Securities, LLC

James.Feldman@wellsfargo.com | 212-214-5328

Thoughts into the Quarter: Throughout 2Q, both at our WF REIT Conference in

Charleston & REITweek, management commentary was incrementally better than the

messaging coming out of 1Q earnings calls. Investment pipelines have continued to build

with most names likely to see upside to conservative initial guides. Investor debates are

around deployment cadence meeting or beating expectations for volume, yields & asset

quality.

We're most positive on OWs WPC & FVR into the quarter. We see upside to WPC

guidance on investment volumes & also believe the recent selloff from the Hellweg news

provides a more favorable entry point given we believe the concern was overstated given

max potential rent loss of ~$5m vs guidance of $8-12m. We also like FVR here as recent

stock performance positions management to outline its improved cost of capital & better

near/mid term growth outlook on the call.

Cap Rates: Despite broad expectations for cap rate compression in Q2/Q3, intra-quarter

conversations with management at our Charleston conference & REITweek suggest that

cap rates have remained stickier than initially feared. The 10yr Treasury was mostly higher