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Ventas, Inc. (VTR - Free Report) reported second-quarter 2023 normalized funds from operations (FFO) per share of 75 cents, outpacing the Zacks Consensus Estimate by a whisker. The reported figure increased 4.2% from the prior-year quarter’s tally.
Results reflect better-than-anticipated revenues. Also, Ventas’ same-store cash net operating income (NOI) increased year over year on strong performance across the portfolio. The company revised its outlook for 2023.
VTR clocked in revenues of $1.11 billion in the second quarter, surpassing the Zacks Consensus Estimate of $1.08 billion. Also, the figure increased 8.2% on a year-over-year basis.
Per Debra A. Cafaro, chairman and CEO of Ventas, “We are pleased to deliver strong second quarter results with broad-based organic property growth across our diverse portfolio. In SHOP, we continue to strongly believe in and experience the multiyear growth and recovery cycle. Growth in the quarter was led by outsized performance in U.S. assisted living, complemented by our highly occupied Canadian portfolio.”
Quarter in Detail
In the reported quarter, same-store cash NOI growth for the total property portfolio (1,161 assets) increased 7% to $426.9 million from the prior-year quarter.
Segment-wise, the same-store cash NOI for the SHOP portfolio (508 assets) climbed 14% year over year to $167.3 million, mainly led by the U.S. communities. Revenue per occupied room (RevPOR) growth of 6.6% and moderating operating expenses resulted in margin expansion of 160 basis points (bps), aiding the rise in the segment’s same-store cash NOI.
The same-store average occupancy remained unchanged sequentially but expanded 10 bps year over year to 81.3% in the second quarter for the SHOP portfolio.
For the outpatient medical and research portfolio (345 assets), same-store cash NOI improved 3.8% year over year to $129.3 million. The uptick resulted from the year-over-year same-store occupancy growth of 110 bps to 92.3%. The outpatient medical portfolio has witnessed same-store cash NOI growth of more than 3% in seven of the past eight quarters.
The triple-net leased (NNN) portfolio’s (308 assets) same-store cash NOI rose 2% year over year to $130.3 million.
Balance Sheet Position
Ventas exited second-quarter 2023 with cash and cash equivalents of $138.6 million, down from $145.4 million as of Mar 31, 2023.
Moreover, it ended the quarter with $2.7 billion of liquidity and a net debt to further adjusted EBITDA ratio of 7.0.
2023 Outlook Revised
Ventas revised its guidance for 2023.
It now expects current-year normalized FFO per share in the range of $2.92-$3.02, revised from $2.90-$3.04 stated earlier. The Zacks Consensus Estimate for the same is currently pegged at $3.00, which lies within the guided range.
The total same-store cash NOI growth is now estimated between 6.5% and 9.5%, up from 6-9% projected earlier. The SHOP segment's same-store cash NOI was retained between 15% and 21%.
The office segment's same-store cash NOI was revised to the range of 2.25-3% from 2-3%, while the estimation for triple-net leased same-store cash NOI was changed to 2-3% from 0-1.5%.
Healthpeak Properties, Inc. reported second-quarter 2023 FFO as adjusted per share of 45 cents, beating the Zacks Consensus Estimate by a whisker. The reported figure improved 2.3% from the year-ago quarter.
Results reflected better-than-anticipated revenues. Moreover, year-over-year improvement in same-store portfolio cash (adjusted) net operating income (NOI) was witnessed across the portfolio. PEAK revised its 2023 outlook.
Welltower Inc.’s (WELL - Free Report) second-quarter 2023 normalized FFO per share of 90 cents surpassed the Zacks Consensus Estimate of 86 cents. The reported figure improved 4.7% from the prior-year quarter’s actual.
Results reflected better-than-anticipated revenues. The total same-store net operating income (SSNOI) increased year over year, driven by SSNOI growth in the seniors housing operating (SHO) portfolio. Welltower also raised its guidance for 2023 normalized FFO per share.
Equinix Inc.’s (EQIX - Free Report) second-quarter 2023 AFFO per share of $8.04 surpassed the Zacks Consensus Estimate of $7.51. The figure improved 6.1% from the prior-year quarter.
EQIX’s results reflect steady growth in colocation and inter-connection revenues on the back of strong demand for digital infrastructure. The company also raised its AFFO per share guidance for 2023.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Ventas' (VTR) Q2 FFO Beats, SHOP NOI Up, '23 View Revised
Ventas, Inc. (VTR - Free Report) reported second-quarter 2023 normalized funds from operations (FFO) per share of 75 cents, outpacing the Zacks Consensus Estimate by a whisker. The reported figure increased 4.2% from the prior-year quarter’s tally.
Results reflect better-than-anticipated revenues. Also, Ventas’ same-store cash net operating income (NOI) increased year over year on strong performance across the portfolio. The company revised its outlook for 2023.
VTR clocked in revenues of $1.11 billion in the second quarter, surpassing the Zacks Consensus Estimate of $1.08 billion. Also, the figure increased 8.2% on a year-over-year basis.
Per Debra A. Cafaro, chairman and CEO of Ventas, “We are pleased to deliver strong second quarter results with broad-based organic property growth across our diverse portfolio. In SHOP, we continue to strongly believe in and experience the multiyear growth and recovery cycle. Growth in the quarter was led by outsized performance in U.S. assisted living, complemented by our highly occupied Canadian portfolio.”
Quarter in Detail
In the reported quarter, same-store cash NOI growth for the total property portfolio (1,161 assets) increased 7% to $426.9 million from the prior-year quarter.
Segment-wise, the same-store cash NOI for the SHOP portfolio (508 assets) climbed 14% year over year to $167.3 million, mainly led by the U.S. communities. Revenue per occupied room (RevPOR) growth of 6.6% and moderating operating expenses resulted in margin expansion of 160 basis points (bps), aiding the rise in the segment’s same-store cash NOI.
The same-store average occupancy remained unchanged sequentially but expanded 10 bps year over year to 81.3% in the second quarter for the SHOP portfolio.
For the outpatient medical and research portfolio (345 assets), same-store cash NOI improved 3.8% year over year to $129.3 million. The uptick resulted from the year-over-year same-store occupancy growth of 110 bps to 92.3%. The outpatient medical portfolio has witnessed same-store cash NOI growth of more than 3% in seven of the past eight quarters.
The triple-net leased (NNN) portfolio’s (308 assets) same-store cash NOI rose 2% year over year to $130.3 million.
Balance Sheet Position
Ventas exited second-quarter 2023 with cash and cash equivalents of $138.6 million, down from $145.4 million as of Mar 31, 2023.
Moreover, it ended the quarter with $2.7 billion of liquidity and a net debt to further adjusted EBITDA ratio of 7.0.
2023 Outlook Revised
Ventas revised its guidance for 2023.
It now expects current-year normalized FFO per share in the range of $2.92-$3.02, revised from $2.90-$3.04 stated earlier. The Zacks Consensus Estimate for the same is currently pegged at $3.00, which lies within the guided range.
The total same-store cash NOI growth is now estimated between 6.5% and 9.5%, up from 6-9% projected earlier. The SHOP segment's same-store cash NOI was retained between 15% and 21%.
The office segment's same-store cash NOI was revised to the range of 2.25-3% from 2-3%, while the estimation for triple-net leased same-store cash NOI was changed to 2-3% from 0-1.5%.
Ventas currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Ventas, Inc. Price, Consensus and EPS Surprise
Ventas, Inc. price-consensus-eps-surprise-chart | Ventas, Inc. Quote
Performance of Other REITs
Healthpeak Properties, Inc. reported second-quarter 2023 FFO as adjusted per share of 45 cents, beating the Zacks Consensus Estimate by a whisker. The reported figure improved 2.3% from the year-ago quarter.
Results reflected better-than-anticipated revenues. Moreover, year-over-year improvement in same-store portfolio cash (adjusted) net operating income (NOI) was witnessed across the portfolio. PEAK revised its 2023 outlook.
Welltower Inc.’s (WELL - Free Report) second-quarter 2023 normalized FFO per share of 90 cents surpassed the Zacks Consensus Estimate of 86 cents. The reported figure improved 4.7% from the prior-year quarter’s actual.
Results reflected better-than-anticipated revenues. The total same-store net operating income (SSNOI) increased year over year, driven by SSNOI growth in the seniors housing operating (SHO) portfolio. Welltower also raised its guidance for 2023 normalized FFO per share.
Equinix Inc.’s (EQIX - Free Report) second-quarter 2023 AFFO per share of $8.04 surpassed the Zacks Consensus Estimate of $7.51. The figure improved 6.1% from the prior-year quarter.
EQIX’s results reflect steady growth in colocation and inter-connection revenues on the back of strong demand for digital infrastructure. The company also raised its AFFO per share guidance for 2023.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.