I know there is a lot of caution in the commercial real estate market but as the population ages long-term care facilities should be a growth market. As always on Financial Tides I try to place my recommendations into one of my simulation portfolios for accountability of my recommendations. For that reason I'm adding Omega Health Care Investors (OHI) to my UpDown portfolio. The portfolio has an annual return of 120%.
Omega Healthcare Investors is a self-administered real estate investment trust which invests in income producing health care facilities, principally long--term care facilities, with the objective of profitable growth and further diversification of the investment portfolio. Investments are located primarily in the United States.
OHI came up on my BarChart screener when I was looking for companies trading over 100K shares a day that have hit new highs in over 50% of the last trading sessions. OHI has hit 14 new highs in the last 20 sessions and is 5 for 5 recently. There has been a 29.75% price appreciation in the last 65 days. Barchart's technical indicators have 12 out of 13 buy signals with only one sell for an 88% buy rating and the sell was a long term indicator and a review of the price chart leads me to believe that the sell signal will turn by the end of the week.
Recently analysts from UBS and JMP have upgraded this stock and they estimate a 7.3% increase in revenues and a 13.1% increase in earnings per share. This is what you'd expect from a quality REIT.
Other sites have positive ratings also. Over on Wall Street Survivor Mark's checklist has Survivor Sentiment at 5/5, Technicals at 5/5 and Motley Fool at 4/5. Further Motley Fool's members' rating by their out or under perform vote 179 to 9 to out perform with the All Stars rating it 48 to 1 to outperform the market.
This stock has 3 qualities I look for:
- BarChart showing that the stock has hit new highs in at least 50% of the last 20 trading sessions
- No negative news from the analyst -- we don't want the brokerage firms trashing the stock we just bought with sell calls to their customers
- Confirmation from other reliable sites that their members are also positive on this stock
Recommendation: I'm buying Omega Healthcare Investors -- OHI -- for my UpDown portfolio around 18.50 with a protective stop loss of not less than 16.
Disclosure: I do not own OHI at the time of publication