Dane Bowler
Value, hedge fund analyst, REITs, long/short equity

A Prominent Sector Headwind Stifles The Growth Of Sabra Healthcare

Sabra Healthcare (NASDAQ:SBRA) is a strong company, but it has become fully valued through price appreciation and slowing growth. Specifically, SBRA's multiple has increased to approximately 12.7X forward FFO and its formerly rapid growth is threatened by sector headwinds. This article will begin with a review of Sabra's history, examine its future and conclude that it is no longer an opportunistic stock.

A Brief History

Since inception in 2010, SBRA has managed to grow its FFO/share in excess of 70%. Early investors were rewarded with substantially above market returns.

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In addition to the price appreciation charted above, SBRA had a large and growing dividend.

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Data from SNL Financial

The pertinent aspect of...

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