Real estate ETFs (exchange-traded funds) hold a basket of real estate investment trusts (REITs) that help diversify portfolios across various companies and property types. Importantly, they provide greater liquidity compared to owning real estate directly. Today, we have leveraged the TipRanks ETF Screener to scan for two real estate ETFs with more than 10% upside potential projected by analysts: the Real Estate Select Sector SPDR Fund (XLRE) and the iShares U.S. Real Estate ETF (IYR).
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Let’s take a closer look at what Wall Street thinks about these two ETFs.
Real Estate Select Sector SPDR Fund (XLRE)
The XLRE ETF seeks to track the performance of the real estate sector of the S&P 500 Index (SPX). It provides exposure to companies through real estate management and REITs, excluding mortgage REITs. XLRE has $5.96 billion in assets under management (AUM), with its top 10 holdings contributing 60.3% of the portfolio.
On TipRanks, the XLRE ETF has a Moderate Buy consensus rating. Of the 33 stocks held, 30 have Buys and three have Hold ratings. The analysts’ average price target on the XLRE ETF of $43.40 implies a 13.23% upside potential from the current levels. The ETF has declined 2.2% in the past six months.
iShares U.S. Real Estate ETF (IYR)
The IYR ETF seeks to track the results of an index composed of U.S. equities in the technology sector. It provides exposure to U.S. electronics, computer software and hardware, and information technology companies. IYR has $2.97 billion in AUM, with its top 10 holdings contributing 46.53% of the portfolio.
On TipRanks, the IYR ETF has a Moderate Buy consensus rating. Of the 75 stocks held, 57 have Buys, 15 have a Hold, and three have a Sell rating. The analysts’ average price target of $97.58 implies a 12.49% upside potential from the current levels. The ETF has declined 2.86% in the past six months.
Concluding Thoughts
Real estate ETFs are a diversified and convenient way to invest in the sector. It allows investors to avoid owning and managing properties, which can be a time-consuming and expensive task. Thus, given the upside potential expected by analysts, XLRE and IYR ETFs might seem worth considering by investors.
