Week In Review: REITs Plunge, Third Quarter SEC Filings
For the week ending December 11, the iShares US Real Estate ETF, the iShares Mortgage Real Estate Capped, and the SPDR S&P 500 ETF ended on a negative note.
A Fund Flow and Volume Analysis of ICF and PJP
ICF has observed healthy growth in its fund inflow after negative fund inflow in 2013, surpassing PJP’s total fund inflows in 2014 and 2015.
Innovation and Foreign Investment Drive Welltower’s Growth
Welltower (HCN) has successfully set itself on a growth trajectory backed by strategic initiatives, aiding its steady top line growth.
How Analysts View HCP Inc. in Fiscal 2018
Analysts gave HCP a mean price target of $26.59, implying a significant ~17.0% rise from its current level of $22.68.
HCP’s Performance in Comparison to Its Peers
HCP has a $2.0 billion credit facility with maturity in 2021, and the majority of its debt matures after 2019.
HCP and Its Falling Shareholder Returns
HCP has indicated that the recently enacted Tax Cut and Jobs Act could materially and adversely affect the company and its stockholders.
HCP’s Portfolio Riding on Developments, Acquisitions, and More
In 4Q17, HCP recorded an $84.0 million impairment on the debt investment and reduced the value to $105.0 million.
HCP Inc.’s Expanding Medical Office Portfolio
Rental revenues for HCP increased ~3.0% from $392.0 million in 2016 to $400.0 million in 2017.
Chart in Focus: HCP’s Life Science Portfolio
Life Science is an 8.0 million square foot portfolio and represents ~25.0% of HCP’s NOI.
Healthcare Trust of America Maintains Its ‘Buy’ Rating in 2018
Analysts gave HTA a mean price target of $33.38, implying a significant ~26.0% rise from its current level of $26.30.
HCP Beats Funds from Operations, Misses on Revenues in 4Q17
For 2017, HCP’s funds from operation stood at $1.95 per share, and its same-store cash NOI growth was 3.4%.
Healthcare Trust of America’s Performance in Comparison to Its Peers
HTA has earnings per share of $0.33 and a PE (price-to-earnings) ratio of ~111.0x.
HCP’s Cautious View for Its Senior Housing Portfolio in 2018
HCP Inc. has a diversified senior housing portfolio, which has a balanced mix of triple net and SHOP (senior housing operating portfolio).
How Healthcare Trust of America Rewards Its Investors
HTA paid dividends of $1.17 in 2015, $1.19 in 2016, and $1.21 in 2017.
Healthcare Trust of America’s Strategic Rationale
HTA has 3.4% combined pro forma same-store NOI growth, and its development assets are currently 86.0% pre-leased.
HTA’s Portfolio Riding on Investments, Acquisitions, and More
Healthcare Trust of America (HTA) completed investments of $2.7 billion in 2017, and 90% of these properties are in key strategic markets.
Healthcare Trust of America and Its Growth Story
Healthcare Trust of America (HTA) has centers in more than 20 key markets in the US, covering 24 million square feet.
Ventas Is Trading at a Discount to Peers
Funds from operation (or FFO) for Ventas (VTR) for 3Q17 stood at $1.04 per share.
Why Ventas Stock Is Falling
The recent increase in interest rates has impacted the performance of VTR.
How Does Ventas’s Balance Sheet Look?
Ventas (VTR) has a strong flexible balance sheet and excellent liquidity.
How Welltower Is Rewarding Its Shareholders
Welltower (HCN) announced a dividend of $0.87 per share for 3Q17 from the previous guidance $0.86 in 3Q16. The dividend yield stands at ~5.6%.
Welltower’s Efficiently Managed Debt and Balance Sheet
Welltower (HCN) has kept its balance sheet in good shape. It has a cash balance of $236 million and $2.6 billion in credit line availability.
Welltower’s 3Q17 Performance and Outlook
Welltower (HCN) increased its SSNOI (same-store net operating income) to 2.5%–3% from 2.25%–3%. This slight increase is due to strong seniors’ housing operating performance.
How Ventas’s Dividend Yield Compares
Revenue and earnings Ventas (VTR) is a major REIT in the United States and Canada. The company’s revenue growth slowed from 18% in 2015 to just 5% in 2016. The growth was driven by all of its segments, through resident fees and services, office building and other service revenue, and income from loans and investments, […]
A Post-2Q17 Comparison of the Top 3 Healthcare REITs
Healthcare Trust of America (HTA) is the most premium among our top three healthcare REITs in terms of price-to-FFO multiple.
How Healthcare REITs Rewarded Stockholders in 2Q17
REITs are required to pay 90.0% of their profits to shareholders in the form of share buybacks or dividends.
Healthcare REITs and Their 2Q17 Capital Deployment Strategies
Welltower spent $292.0 million on development and expansion in 2Q17. Of that, $110.0 million was spent on acquisitions.
Healthcare REITs and How They Managed Expenses in 2Q17
Healthcare REITs fund their working capital through debt and equity. So it’s important to optimize their spending in order to maximize income.
What’s Ahead for the Top 3 Healthcare REITs?
Strong performance in skilled nursing facilities prompted Welltower management to increase its same-store net operating income guidance for fiscal 2017.
Top-Line and Bottom-Line Results for Healthcare REITs in 2Q17
Healthcare REITs have positioned their properties in premium locations where there’s high income growth.
Top 3 Healthcare REITs after 2Q17: A Comparative Analysis
Healthcare REITs that own senior care facilities, hospitals, and nursing homes are seeing growth. With the aging population rising, the need for critical healthcare facilities is also rising.
Welltower Compared to Other Industry Players after 2Q17
Welltower’s current price-to-FFO multiple is 17.34x. It had higher-than-expected results in 2Q17 and has an optimistic outlook for fiscal 2017.
How Welltower Maintained a Strong Balance Sheet in 2Q17
Wellstone’s debt-to-equity ratio stood at 0.81x for 2Q17. That was lower than the industry mean of 1.07x.
How Welltower Rewarded Stockholders in 2Q17
On June 30, 2017, Welltower (HCN) announced a quarterly cash dividend of $0.87. The dividend is scheduled to be paid on August 21, 2017.
How Welltower Fared in Terms of Cost Control in 2Q17
Higher same-store NOI (net operating income) and a strong demand for premium senior housing facilities drove Welltower’s profits during the quarter.
How Does Wall Street Rate Welltower among Healthcare REITs?
Welltower’s (HCN) expected performance in 2017 is reflected in analysts’ ratings for its stock. Analysts have given HCN a mean price target of $72.19.
Comparing Welltower to Its Industry Peers
The price-to-FFO (funds from operations) multiple is the most popular method of valuing real estate investment trusts (or REIT) such as Welltower (HCN).
How Well Does Welltower Return Value to Its Shareholders?
Healthcare REITs such as Welltower (HCN) have to pay at least 90% of their taxable incomes as shareholder returns in order to function as REITs.
How Obamacare Has Affected Welltower and Healthcare REITs
The new administration under President Donald Trump has taken a key step toward repealing the Affordable Health Care Act, more popularly known as Obamacare.
Will Welltower Maintain Its Business Momentum in the Future?
Welltower’s (HCN) strategic presences in high-barrier and affluent markets help it to maintain its leadership in the healthcare infrastructure industry.
Welltower: A Healthcare REIT Poised to Grow amid Macro Headwinds
Amid uncertainty in the healthcare sector, Welltower has been able to maintain its business momentum on the back of higher operating efficiency and strategic initiatives.
Comparing Growth and Value Stock Sectors
The SPDR S&P 500 Growth ETF (SPYG) has generated a YTD return of 13.3% versus 4.3% from the SPDR S&P 500 Value ETF (SPYV).
How Would Negative Interest Rates Impact REITs?
A fall in interest rates makes REITs more attractive dividend-yielding investments compared to bonds. This is because REITs have been traditionally viewed as dividend-yielding investments.
Healthcare REITs Continue Their Strong Run
Healthcare REITs have shown resilience in the rising rate environment. REITs will likely be hurt more in this environment since they have to incur higher expenses.
REIT Capitalization Rates Fall as Prices Surge
Average capitalization rates in 2Q15 fell to 7.5% across all the property types compared to 8.35% in 2Q14.
US Financial Sector Performance Review, Week Ended September 11
The savings and loans subgroup performed best in XLF in the week ended September 11. It rose 2.31% in value, while the diversified financial services subgroup rose 1.17%.
Why Are Capitalization Rates Important for Investors?
The capitalization rate, or cap rate, is an important concept in the commercial real estate industry. It’s defined as an initial yield on a real estate investment.
What Methods Are Used to Determine REITs’ Valuation?
Traditional valuation methods don’t apply to REITs because their operations are different from traditional companies. REITs are valued based on three main techniques.
SPY’s Struggle with Wall Street Continues
Of the 502 constituent stocks of SPY, only 23 recorded positive returns on Wall Street on August 20. Only seven stocks traded at a closing price above their moving averages.
REITs’ Dividend Yield Is Higher Compared to Other Asset Classes
The dividend yield is calculated as an annual dividend divided by the share price. REIT dividend yields can be compared to the yields of other asset classes.
What Factors Drive REIT Earnings?
Economic growth is the major factor that determines REITs’ growth. An uptick in economic fundamentals positively affects the REITs by increasing business growth.
What Sectoral Equity REITs Are Available to Investors?
Equity REITs dominate the REIT market. They account for almost 90% of the total market capitalization of all the REITs. They include specialized REITs.
What Are the Different Types of REITs?
There are three types of REITs—equity REITs, mortgage REITs, and hybrid REITs. Mortgage REITs lend money to landlords and their operators to purchase a property.
Advantages and Disadvantages of Investing in REITs
Every investment comes with certain advantages and disadvantages. REITs are no exception. There are benefits and risks associated with investing in REITs.
What Are the Regulatory Requirements to Qualify as a REIT?
To qualify as a REIT, a company must make REIT election by filing a Form 1120-REIT with the IRS. This is essential to reduce or eliminate corporate tax.
US Mortgage Applications Dip, Housing Market Seeks Revival
Mortgage applications really dove during the fourth quarter last year. They recovered a little in January, but fell again in February 2015.