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  • Health Care Update For 4-11-14 1 comment
    Apr 12, 2014 12:40 PM
    Health Care Update for Q2-14

    Yields are calculated on Q1-14 dividends. HCN has announced a February increase in the dividend to $0.795/share - OHI an increase to $0.49/share - SBRA an increase to $0.36 - MPW increased to $0.21/share. The Dividend/FFO ratio uses the 2014 FFO projection. AVIV started trading on 3-21-13 and DOC on 7-19-13. The sector average LTM (last twelve month) dividend change omits AVIV and DOC from that calculation. NHI has already announced an increase to $0.77 in its Q2-14 dividend.


     Share Price2014 FFO Estimate Div/Percent ChangeLTM
    Company_name_and_ticker1-0104-111-0104-11YieldFFOPricePr+Div14 FFOTargetDiv

    Aviv REIT(NYSE:AVIV)23.7025.001.851.865.7677.425.498.520.540.380.00
    Physicians Realty(NYSE:DOC)12.2413.280.980.956.7894.748.5010.33-3.062.190.00
    Health Care REIT(NYSE:HCN)53.5761.774.004.035.1578.9115.3116.790.75-2.123.92
    Health Care Prop(NYSE:HCP)36.3240.223.063.025.4272.1910.7412.24-1.31-4.853.81
    Health Care Realty(NYSE:HR)21.3124.431.411.454.9182.7614.6416.052.84-2.580.00
    Health Care Trust(NYSE:HTA)9.8411.430.690.735.0378.7716.1617.625.801.900.00
    LTC Property(NYSE:LTC)35.3938.232.652.635.3477.578.029.47-0.756.319.68
    Med Prop Trust(NYSE:MPW)12.2212.961.121.116.4875.686.067.77-0.89-0.235.00
    Nat'l Health Inv(NYSE:NHI)56.1059.404.134.074.9572.245.887.19-1.450.799.70
    Omega Health(NYSE:OHI)29.8034.092.732.755.7571.2714.4016.040.73-3.088.89
    Sabra Health Care(NASDAQ:SBRA)26.1429.762.202.264.8463.7213.8515.232.733.865.88
    Senior Housing(NYSE:SNH)22.2322.451.741.766.9588.640.992.741.15-2.950.00
    Universal Health(NYSE:UHT)40.0642.562.802.835.8788.346.247.801.070.000.81
    Ventas(NYSE:VTR)57.2863.154.364.374.5966.3610.2511.510.23-4.008.21

    Average     5.5677.769.7511.380.60-0.314.66

    Dividend dates are:

    AVIV: 04-11-14DOC: 04-24-14HCN: 02-19-14HCP: 02-24-14HR : 02-27-14HTA: 04-02-14LTC: monthly
    MPW: 04-10-14NHI: 05-08-14OHI: 02-17-14SBRA: 02-27-14SNH: 05-20-14UHT: 03-30-14VTR: 03-27-14

    Historical yields for the sector:

    Mar 2005: 6.99%June: 6.09%Sept: 6.22%Dec: 6.73%
    Mar 2006: 6.18%June: 6.79%Sept: 5.85%Dec: 5.28%
    Mar 2007: 5.33%June: 6.24%Sept: 5.90%Dec: 5.77%
    Mar 2008: 5.84%June: 6.33%Sept: 5.25%Dec: 6.89%
    Mar 2009: 9.11%June: 7.88%Sept: 6.67%Dec: 6.31%
    Mar 2010: 6.67%June: 6.09%Sept: 5.62%Dec: 5.75%
    Mar 2011: 5.48%June: 5.64%Sept: 6.02%Dec: 5.34%
    Mar 2012: 5.16%June: 4.84%Sept: 4.89%Dec: 4.69%
    Mar 2013: 4.66%June: 5.09%Sept: 5.49%Dec: 6.02%
    Mar 2014: 5.63%June:Sept:Dec:
    Health Care Price/FFO Ratios 04-11

    The analyst projected FFO stats for UTH that I find at Yahoo Finance look bad to me. Those projections are not in line with what UHT is reporting. This date uses a 2014 FFO projection that is a run rate based on current trends. HTA IPOed in June of 2012. 'Normalized FFO' stats for the pre-IPO years came from its 2011 10-K. When AVIV and DOC were added to the sector on 11-19-13, the sector average 2013 price/FFO ratio rose from 14.94 to 15.79. The DOC FFO projection fell 50%, distorting the 2013 sector ratio. 2012 FFO growth was 10.77% and 2013 growth was 7.65% before the addition of the newbies. AVIV and DOC do not distort the 2014 and 2015 sector average ratios.


     FFO / Share% FFO GrowthPrice/FFO14 FFO Range
    Co.20102011201220132014201512-1313-1414-15201320142015HighLowRange

    AVIV0.000.000.001.261.862.05na47.6210.2219.8413.4412.2019315222.04%
    DOC0.000.000.000.260.951.18na265.3824.2151.0813.9811.251069016.84%
    HCN3.133.413.513.364.034.21-4.2719.944.4718.3815.3314.674123973.72%
    HCP2.192.692.763.013.023.139.060.333.6413.3613.3212.853102983.97%
    HR1.291.151.311.321.451.570.769.858.2818.5116.8515.561481396.21%
    HTA0.380.510.610.640.730.774.9214.065.4817.8615.6614.8475706.85%
    LTC1.882.152.262.372.632.834.8710.977.6016.1314.5413.512692564.94%
    MPW0.660.710.900.961.111.186.6715.636.3113.5011.6810.981141049.01%
    NHI2.762.883.183.554.074.2711.6414.654.9116.7314.5913.914183965.41%
    OHI1.611.892.192.532.752.8015.538.701.8213.4712.4012.182792703.27%
    SBRA0.001.311.411.842.262.3930.5022.835.7516.1713.1712.4524120217.26%
    SNH1.701.731.751.691.761.85-3.434.145.1113.2812.7612.141811706.25%
    UHT2.612.572.842.772.832.89-2.462.172.1215.3615.0414.732832830.00%
    VTR2.853.373.804.144.374.568.955.564.3515.2514.4513.854454205.72%

    Average     6.8931.566.7318.5014.0813.22

    Historical Price/FFO ratios for the sector:

    Mar 2007: 15.23June: 13.19Sept: 14.18Dec: 14.55
    Mar 2008: 14.17June: 13.27Sept: 15.95Dec: 12.38
    Mar 2009: 9.42June: 10.84Sept: 12.61Dec: 13.90
    Mar 2010: 12.61June: 14.10Sept: 15.45Dec: 15.41
    Mar 2011: 15.07June: 14.62Sept: 12.91Dec: 14.95
    Mar 2012: 14.21June: 15.25Sept: 15.05Dec: 15.82
    Mar 2013: 17.18June: 15.84Sept: 15.21Dec: 16.67

    Disclosure: I am long LTC, OHI, VTR.

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  • Das Kapital Gainz
    , contributor
    Comments (7) | Send Message
     
    Factoids,

     

    Great work as always.

     

    This is a terrific sector given aging U.S. demographics and think its probably the best REIT sector to overweight. I have been holding onto HCN & HCP forever and they have served me very well over the years providing valuable income and stability during many difficult times. Collectively they should remain good investments given prudent financial management and the ability to grow distributions faster than the rise in interest rates and/or inflation.

     

    A newer health care reit you might want to keep an eye on is American Realty Capital Health Care Trust, Inc. (HCT) that had a recent IPO. Some of the newer ones (HTA, AVIV, SBRA, DOC) have the most attractive growth projections but I am never comfortable with analysts on newer issues.

     

    Without consideration of the newer health care REITs, I like your picks, especially OHI which I would probably buy first based on what appears to be the most solid recent and intermediate performance metrics compared to larger and more diversified competitors.

     

    Happy Income Hunting and best wishes,
    Das Kapital Gainz (AKA BEHOLD)
    13 Apr, 09:12 AM Reply Like
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