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Welltower Inc. (WELL - Free Report) reported normalized funds from operations (FFO) per share of 80 cents in third-quarter 2021, in line with the Zacks Consensus Estimate. However, the reported figure compares unfavorably with the year-ago quarter’s 84 cents.
The company generated revenues of $1.24 billion, outpacing the Zacks Consensus Estimate of $1.18 billion. Further, the top line increased 19.6%, year over year.
Welltower seniors housing operating (“SHO”) portfolio is seeing a recovery in occupancy. Also, the return of many communities to the pre-COVID conditions aided its performance, with move-in activity being impressive during the quarter.
Concurrent with the third-quarter earnings release, Welltower announced its agreements to acquire four distinct seniors housing portfolios for a pro rata gross investment amount of $1.3 billion.
Quarter in Detail
Welltower's pro-rata gross investments in the third quarter totaled $2.2 billion. This included $2.1 billion in acquisitions and loan funding, and $141 million in development funding.
Apart from this, the company completed property dispositions and loan payoffs of $488 million.
Balance Sheet Position
Welltower exited the third quarter with $304 million of cash and cash equivalents, down from the $1.6 billion recorded in the prior-year quarter.
As of Sep 30, the company had near-term liquidity of $4 billion and no material senior unsecured note maturities until 2024.
Dividend Update
On Nov 4, Welltower announced a cash dividend of 61 cents per share for the third quarter. The dividend will be paid out on Nov 23 to stockholders of record as of Nov 16, 2021. This marks the company’s 202nd consecutive quarterly cash dividend payout.
COVID-19 Update
The company’s SHO portfolio witnessed a sequential expansion of 210 basis points (bps) in spot occupancy to 76.7% in September from 74.6% in June.
The SHO portfolio expenses significantly flared up in the current quarter on higher seasonal utility costs and elevated labor expenses.
Guidance
The company projects fourth-quarter 2021 normalized FFO per share of 78-83 cents. The Zacks Consensus Estimate for the same is pegged at 84 cents.
For fourth-quarter 2021, the average pro rata occupancy is expected to sequentially advance 140 bps.
Prologis, Inc. (PLD - Free Report) came up with third-quarter core FFO per share of $1.04, surpassing the Zacks Consensus Estimate of $1.03. Results reflected solid increases in market rents and valuations amid unprecedented low vacancies in its markets.
Boston Properties Inc.’s (BXP - Free Report) third-quarter 2021 FFO per share of $1.73 beat the Zacks Consensus Estimate of $1.70. The quarterly figure also exceeded the mid-point of the company’s third-quarter guidance by 4 cents, highlighting the better-than-projected results from the in-service portfolio and improved parking revenues.
Highwoods Properties, Inc.’s (HIW - Free Report) FFO per share of 96 cents topped the Zacks Consensus Estimate of 93 cents for the September-end quarter. Rental and other revenues of $195.5 million outpaced the consensus mark of $192.2 million.
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) Q3 FFO Meets, Revenues Surpass Estimates
Welltower Inc. (WELL - Free Report) reported normalized funds from operations (FFO) per share of 80 cents in third-quarter 2021, in line with the Zacks Consensus Estimate. However, the reported figure compares unfavorably with the year-ago quarter’s 84 cents.
The company generated revenues of $1.24 billion, outpacing the Zacks Consensus Estimate of $1.18 billion. Further, the top line increased 19.6%, year over year.
Welltower seniors housing operating (“SHO”) portfolio is seeing a recovery in occupancy. Also, the return of many communities to the pre-COVID conditions aided its performance, with move-in activity being impressive during the quarter.
Concurrent with the third-quarter earnings release, Welltower announced its agreements to acquire four distinct seniors housing portfolios for a pro rata gross investment amount of $1.3 billion.
Quarter in Detail
Welltower's pro-rata gross investments in the third quarter totaled $2.2 billion. This included $2.1 billion in acquisitions and loan funding, and $141 million in development funding.
Apart from this, the company completed property dispositions and loan payoffs of $488 million.
Balance Sheet Position
Welltower exited the third quarter with $304 million of cash and cash equivalents, down from the $1.6 billion recorded in the prior-year quarter.
As of Sep 30, the company had near-term liquidity of $4 billion and no material senior unsecured note maturities until 2024.
Dividend Update
On Nov 4, Welltower announced a cash dividend of 61 cents per share for the third quarter. The dividend will be paid out on Nov 23 to stockholders of record as of Nov 16, 2021. This marks the company’s 202nd consecutive quarterly cash dividend payout.
COVID-19 Update
The company’s SHO portfolio witnessed a sequential expansion of 210 basis points (bps) in spot occupancy to 76.7% in September from 74.6% in June.
The SHO portfolio expenses significantly flared up in the current quarter on higher seasonal utility costs and elevated labor expenses.
Guidance
The company projects fourth-quarter 2021 normalized FFO per share of 78-83 cents. The Zacks Consensus Estimate for the same is pegged at 84 cents.
For fourth-quarter 2021, the average pro rata occupancy is expected to sequentially advance 140 bps.
Currently, the company carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Welltower Inc. Price, Consensus and EPS Surprise
Welltower Inc. price-consensus-eps-surprise-chart | Welltower Inc. Quote
Performance of Other REITs
Prologis, Inc. (PLD - Free Report) came up with third-quarter core FFO per share of $1.04, surpassing the Zacks Consensus Estimate of $1.03. Results reflected solid increases in market rents and valuations amid unprecedented low vacancies in its markets.
Boston Properties Inc.’s (BXP - Free Report) third-quarter 2021 FFO per share of $1.73 beat the Zacks Consensus Estimate of $1.70. The quarterly figure also exceeded the mid-point of the company’s third-quarter guidance by 4 cents, highlighting the better-than-projected results from the in-service portfolio and improved parking revenues.
Highwoods Properties, Inc.’s (HIW - Free Report) FFO per share of 96 cents topped the Zacks Consensus Estimate of 93 cents for the September-end quarter. Rental and other revenues of $195.5 million outpaced the consensus mark of $192.2 million.
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.