Investment thesis and background
My last article analyzed the long-term prospects of Omega Healthcare Investors (NYSE:OHI). A cost of capital analysis was used to show that the business sustainably earns a healthy
Omega Healthcare Investors: An Asset/Income Valuation Approach
Summary
- This article suggests a valuation method based on book value and dividend to value well-established businesses as an asset plus income purchase.
- The method relies on two of the most easily obtainable data with the least amount of ambiguity, and using a few reliable data points is often better than using many.
- This valuation method suggests that Omega Healthcare Investors is attractively valued at its current price, offering a good opportunity to buy a quality business under today’s overall expensive market.
Sensor Unlimited is an economist by training with a PhD, with a focus on financial economics. She is a quantitative modeler and for the past decade she has been covering the mortgage market, commercial market, and the banking industry. She writes about asset allocation and ETFs, particularly those related to the overall market, bonds, banking and financial sectors, and housing markets.
Sensor Unlimited contributes to the investing group Envision Early Retirement which is led by Sensor Unlimited. They offer proven solutions to generate both high income and high growth with isolated risks through dynamic asset allocation. Features include: two model portfolios - one for short-term survival/withdrawal and one for aggressive long-term growth, direct access via chat to discuss ideas, monthly updates on all holdings, tax discussions, and ticker critiques by request. Learn More.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of OHI either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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