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Welltower (WELL) Q1 FFO Beat Estimates, Same Store NOI Rises
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Welltower Inc.’s (WELL - Free Report) first-quarter 2024 normalized funds from operations (FFO) per share of $1.01 surpassed the Zacks Consensus Estimate of 94 cents. The reported figure improved 18.8% year over year.
Results reflect better-than-anticipated revenues. The total portfolio same-store net operating income (SSNOI) increased year over year, driven by SSNOI growth in the seniors housing operating (SHO) portfolio. The company also raised its guidance for 2024.
WELL recorded revenues of $1.86 billion in the quarter, outpacing the Zacks Consensus Estimate of $1.81 billion. Moreover, the top line increased 19.2% year over year.
Quarter in Detail
The SHO portfolio’s same-store revenues increased 10.3% year over year, backed by a 340-basis point uptick in average occupancy and Revenue per Occupied Room (’RevPOR’) growth of 4.8%.
In the first quarter, property operating expenses increased 14.5% to $1.1 billion year over year.
The company’s total portfolio SSNOI grew 12.9% year over year, supported by SSNOI growth in its SHO portfolio of 25.5%.
WELL’s pro-rata gross investments in the first quarter totaled $449 million. This included $208 million in acquisitions and loan funding and $241 million in development funding. It opened 10 development projects for a pro-rata investment amount of $166 million. Welltower also completed pro-rata property dispositions and loan payoffs of $107 million in the quarter.
Balance Sheet Position
As of Mar 31, 2024, WELL had $6.5 billion of available liquidity, comprising $2.5 billion of available cash and restricted cash, and full capacity under its $4 billion line of credit.
Dividend Update
On Apr 29, concurrent with its fourth-quarter 2024 earnings release, Welltower announced a cash dividend of 61 cents per share for the first quarter. The dividend will be paid out on May 22 to stockholders of record as of May 13, 2024. This will mark the company’s 212th consecutive quarterly cash dividend payout.
2024 Guidance Raised
Welltower now projects 2024 normalized FFO per share of $4.02-$4.15, up from the prior-guided range of $3.94-$4.10. The Zacks Consensus Estimate for the same is pegged at $4.05, which lies within the company's guided range.
WELL’s guidance now assumes the average blended SSNOI growth of 9-12%, comprising 17-22% growth in Seniors Housing Operating, 2.5-4.0% in Seniors Housing Triple-net, 2-3% in Outpatient Medical and 2-3% in Long-Term/Post-Acute Care.
Welltower expects to fund an additional $660 million of development in 2024 relating to projects underway as of Mar 31, 2024.
Cousins Properties’ (CUZ - Free Report) first-quarter 2024 funds from operations (FFO) per share of 65 cents beat the Zacks Consensus Estimate of 63 cents.
Results reflect better-than-anticipated revenues. Although the company witnessed healthy leasing activity, higher interest expenses acted as a dampener. CUZ also revised its 2024 outlook for FFO per share.
Alexandria Real Estate Equities, Inc. (ARE - Free Report) reported first-quarter 2024 adjusted funds from operations (AFFO) per share of $2.35, which beat the Zacks Consensus Estimate of $2.31. The reported figure also climbed 7.3% from the year-ago quarter.
Results reflected a rise in revenues, aided by decent leasing activity and rental rate growth. ARE also narrowed its 2024 outlook.
Note: Anything related to earnings presented in this write-up represents FFO, a widely used metric to gauge the performance of REITs.
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Welltower (WELL) Q1 FFO Beat Estimates, Same Store NOI Rises
Welltower Inc.’s (WELL - Free Report) first-quarter 2024 normalized funds from operations (FFO) per share of $1.01 surpassed the Zacks Consensus Estimate of 94 cents. The reported figure improved 18.8% year over year.
Results reflect better-than-anticipated revenues. The total portfolio same-store net operating income (SSNOI) increased year over year, driven by SSNOI growth in the seniors housing operating (SHO) portfolio. The company also raised its guidance for 2024.
WELL recorded revenues of $1.86 billion in the quarter, outpacing the Zacks Consensus Estimate of $1.81 billion. Moreover, the top line increased 19.2% year over year.
Quarter in Detail
The SHO portfolio’s same-store revenues increased 10.3% year over year, backed by a 340-basis point uptick in average occupancy and Revenue per Occupied Room (’RevPOR’) growth of 4.8%.
In the first quarter, property operating expenses increased 14.5% to $1.1 billion year over year.
The company’s total portfolio SSNOI grew 12.9% year over year, supported by SSNOI growth in its SHO portfolio of 25.5%.
WELL’s pro-rata gross investments in the first quarter totaled $449 million. This included $208 million in acquisitions and loan funding and $241 million in development funding. It opened 10 development projects for a pro-rata investment amount of $166 million. Welltower also completed pro-rata property dispositions and loan payoffs of $107 million in the quarter.
Balance Sheet Position
As of Mar 31, 2024, WELL had $6.5 billion of available liquidity, comprising $2.5 billion of available cash and restricted cash, and full capacity under its $4 billion line of credit.
Dividend Update
On Apr 29, concurrent with its fourth-quarter 2024 earnings release, Welltower announced a cash dividend of 61 cents per share for the first quarter. The dividend will be paid out on May 22 to stockholders of record as of May 13, 2024. This will mark the company’s 212th consecutive quarterly cash dividend payout.
2024 Guidance Raised
Welltower now projects 2024 normalized FFO per share of $4.02-$4.15, up from the prior-guided range of $3.94-$4.10. The Zacks Consensus Estimate for the same is pegged at $4.05, which lies within the company's guided range.
WELL’s guidance now assumes the average blended SSNOI growth of 9-12%, comprising 17-22% growth in Seniors Housing Operating, 2.5-4.0% in Seniors Housing Triple-net, 2-3% in Outpatient Medical and 2-3% in Long-Term/Post-Acute Care.
Welltower expects to fund an additional $660 million of development in 2024 relating to projects underway as of Mar 31, 2024.
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
Cousins Properties’ (CUZ - Free Report) first-quarter 2024 funds from operations (FFO) per share of 65 cents beat the Zacks Consensus Estimate of 63 cents.
Results reflect better-than-anticipated revenues. Although the company witnessed healthy leasing activity, higher interest expenses acted as a dampener. CUZ also revised its 2024 outlook for FFO per share.
Alexandria Real Estate Equities, Inc. (ARE - Free Report) reported first-quarter 2024 adjusted funds from operations (AFFO) per share of $2.35, which beat the Zacks Consensus Estimate of $2.31. The reported figure also climbed 7.3% from the year-ago quarter.
Results reflected a rise in revenues, aided by decent leasing activity and rental rate growth. ARE also narrowed its 2024 outlook.
Note: Anything related to earnings presented in this write-up represents FFO, a widely used metric to gauge the performance of REITs.