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Welltower (WELL) Sees Seniors Housing Occupancy Gains in April
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Welltower Inc.’s (WELL - Free Report) seniors housing operating (“SHO”) portfolio is seeing a recovery in occupancy, going by its recent business update. In fact, total SHO pro-rata occupancy for April improved 50 basis points (bps) to 74%.
Markedly, April 2021 marks the first monthly occupancy gain since the onset of the COVID-19 pandemic. Also, April occupancy level indicates an occupancy gain of 80 bps since the pandemic-low on Mar 12, 2021.
The company’s Canada SHO portfolio saw an occupancy decline of nearly 70 bps from Mar 12, 2021, through April-end due to high COVID-19 cases, and the resultant lockdowns and other government-mandated restrictions. Nonetheless, over the same period, its U.S. and UK SHO portfolios reported occupancy gains of roughly 130 bps since Mar 12, 2021.
Notably, acceleration in vaccinations has reduced resident cases by 99% over the trailing two weeks. Also, the relaxation of restrictions has enabled the majority of the company’s communities to restart accepting residents, and this has resulted in higher move-in activity and occupancy growth in recent weeks. The resumption of in-person tours, indoor visitation, communal dining, and social activities at its communities is also encouraging.
For second-quarter 2021, management expects a sequential occupancy increase of 130 bps. Moreover, in the wake of aging baby boomers, we expect Welltower’s communities to absorb vacancy at a faster pace. Amid such encouraging prospects for recovery, the company’s efforts to increase focus on seniors housing asset class are strategic fits.
Particularly, subsequent to the first-quarter end, it purchased two seniors housing properties in Philadelphia and Quebec for a pro-rata investment of $68 million. Also, Welltower is focusing on portfolio optimization and synergistic collaborations with health systems to invest in the next-generation assets of health and wellness care delivery.
In fact, the company has resorted to capital-recycling activities to finance near-term investment and development opportunities. From the beginning of the year through Apr 27, it completed $1.3 billion of pro-rata gross investments, exclusive of development funding. Moreover, restructuring initiatives have enabled the company to attract top-class operators, whereas dispositions have improved the quality of its cash flows.
However, expenses are expected to continue to remain elevated due to additional health and safety measures adopted in light of the pandemic. Hence, amid such rising expenses, the company is likely to witness strain on margins in the near term.
Industrial Logistics Properties Trust’s (ILPT - Free Report) funds from operations (“FFO”) per share estimate for the current year has moved up 4.5% to $1.87 in the past month. The company currently carries a Zacks Rank of 2 (Buy).
OUTFRONT Media Inc.’s (OUT - Free Report) Zacks Consensus Estimate for 2021 FFO per share has moved marginally north to 89 cents over the past month. The company currently carries a Zacks Rank of 2.
Braemar Hotels & Resorts Inc. (BHR - Free Report) carries a Zacks Rank of 2 at present. The Zacks Consensus Estimate for the ongoing year’s FFO per share has been revised around 38% upward in a month to 44 cents.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Welltower (WELL) Sees Seniors Housing Occupancy Gains in April
Welltower Inc.’s (WELL - Free Report) seniors housing operating (“SHO”) portfolio is seeing a recovery in occupancy, going by its recent business update. In fact, total SHO pro-rata occupancy for April improved 50 basis points (bps) to 74%.
Markedly, April 2021 marks the first monthly occupancy gain since the onset of the COVID-19 pandemic. Also, April occupancy level indicates an occupancy gain of 80 bps since the pandemic-low on Mar 12, 2021.
The company’s Canada SHO portfolio saw an occupancy decline of nearly 70 bps from Mar 12, 2021, through April-end due to high COVID-19 cases, and the resultant lockdowns and other government-mandated restrictions. Nonetheless, over the same period, its U.S. and UK SHO portfolios reported occupancy gains of roughly 130 bps since Mar 12, 2021.
Notably, acceleration in vaccinations has reduced resident cases by 99% over the trailing two weeks. Also, the relaxation of restrictions has enabled the majority of the company’s communities to restart accepting residents, and this has resulted in higher move-in activity and occupancy growth in recent weeks. The resumption of in-person tours, indoor visitation, communal dining, and social activities at its communities is also encouraging.
For second-quarter 2021, management expects a sequential occupancy increase of 130 bps. Moreover, in the wake of aging baby boomers, we expect Welltower’s communities to absorb vacancy at a faster pace. Amid such encouraging prospects for recovery, the company’s efforts to increase focus on seniors housing asset class are strategic fits.
Particularly, subsequent to the first-quarter end, it purchased two seniors housing properties in Philadelphia and Quebec for a pro-rata investment of $68 million. Also, Welltower is focusing on portfolio optimization and synergistic collaborations with health systems to invest in the next-generation assets of health and wellness care delivery.
In fact, the company has resorted to capital-recycling activities to finance near-term investment and development opportunities. From the beginning of the year through Apr 27, it completed $1.3 billion of pro-rata gross investments, exclusive of development funding. Moreover, restructuring initiatives have enabled the company to attract top-class operators, whereas dispositions have improved the quality of its cash flows.
However, expenses are expected to continue to remain elevated due to additional health and safety measures adopted in light of the pandemic. Hence, amid such rising expenses, the company is likely to witness strain on margins in the near term.
Shares of this Zacks Rank #3 (Hold) company have gained 14.4% over the past six months compared with the industry's growth of 11.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stocks to Consider
Industrial Logistics Properties Trust’s (ILPT - Free Report) funds from operations (“FFO”) per share estimate for the current year has moved up 4.5% to $1.87 in the past month. The company currently carries a Zacks Rank of 2 (Buy).
OUTFRONT Media Inc.’s (OUT - Free Report) Zacks Consensus Estimate for 2021 FFO per share has moved marginally north to 89 cents over the past month. The company currently carries a Zacks Rank of 2.
Braemar Hotels & Resorts Inc. (BHR - Free Report) carries a Zacks Rank of 2 at present. The Zacks Consensus Estimate for the ongoing year’s FFO per share has been revised around 38% upward in a month to 44 cents.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
See these 7 breakthrough stocks now>>