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Ventas' (VTR) Q3 FFO & Revenues Beat Estimates, Guides Up
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Ventas, Inc. (VTR - Free Report) reported third-quarter 2016 normalized funds from operations (“FFO”) of $1.03 per share, beating the Zacks Consensus Estimate of $1.01.
The company posted revenues of $867.1 million in the third quarter, which beat the Zacks Consensus Estimate of $847 million. Further, it compared favorably with the year-ago tally of $827.6 million.
Modest NOI Growth
For the third quarter, same-store cash net operating income (“NOI”) growth for total portfolio (1,184 assets) was 2.4% on a reported basis. Notably, triple net same-store cash NOI grew 4.2%, the seniors housing operating portfolio same-store NOI grew 2.0% and the medical office building portfolio rose 0.2%.
In September, Ventas closed the acquisition of life science and innovation centers managed by Wexford Science & Technology, LLC (“Wexford”) for around $1.5 billion.
During the quarter, and immediately following the quarter, Ventas sold real estate assets and got repayment on loans totaling $197 million.
Liquidity
Presently, the company has around $1.8 billion available under its revolving credit facility and $134 million of cash or cash equivalents in hand.
2016 Outlook
Ventas revised its 2016 normalized FFO per share outlook in the range of $4.10 – $4.13, denoting expected growth of 4–5% from 2015 on a comparable basis. Moreover, this marks an upward revision from the earlier projected range of $4.05–$4.13.
The company anticipates same-store cash NOI growth of 2.5–3% in 2016. The previous guidance was 2–3%. Further, for 2016, Ventas estimates dispositions of $500 million and intends to use the net proceeds from disposition for reinvestment into acquisition and debt repayment.
Our Take
Going forward, we believe that Ventas’ adequate size and scale would help it capitalize on opportunities such as increasing healthcare spending, aging population and a rise in insured individuals. Yet, stiff competition and a projected rise in interest rates keep us concerned.
Some important REITs which are slated to report next week include Taubman Centers, Inc. , Regency Centers Corporation (REG - Free Report) and Host Hotels & Resorts, Inc. (HST - Free Report) .
Note: All EPS numbers presented in this write-up represent funds from operations (“FFO”) per share. FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
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Ventas' (VTR) Q3 FFO & Revenues Beat Estimates, Guides Up
Ventas, Inc. (VTR - Free Report) reported third-quarter 2016 normalized funds from operations (“FFO”) of $1.03 per share, beating the Zacks Consensus Estimate of $1.01.
The company posted revenues of $867.1 million in the third quarter, which beat the Zacks Consensus Estimate of $847 million. Further, it compared favorably with the year-ago tally of $827.6 million.
Modest NOI Growth
For the third quarter, same-store cash net operating income (“NOI”) growth for total portfolio (1,184 assets) was 2.4% on a reported basis. Notably, triple net same-store cash NOI grew 4.2%, the seniors housing operating portfolio same-store NOI grew 2.0% and the medical office building portfolio rose 0.2%.
Notable Portfolio Activity
In September, Ventas closed the acquisition of life science and innovation centers managed by Wexford Science & Technology, LLC (“Wexford”) for around $1.5 billion.
During the quarter, and immediately following the quarter, Ventas sold real estate assets and got repayment on loans totaling $197 million.
Liquidity
Presently, the company has around $1.8 billion available under its revolving credit facility and $134 million of cash or cash equivalents in hand.
2016 Outlook
Ventas revised its 2016 normalized FFO per share outlook in the range of $4.10 – $4.13, denoting expected growth of 4–5% from 2015 on a comparable basis. Moreover, this marks an upward revision from the earlier projected range of $4.05–$4.13.
The company anticipates same-store cash NOI growth of 2.5–3% in 2016. The previous guidance was 2–3%. Further, for 2016, Ventas estimates dispositions of $500 million and intends to use the net proceeds from disposition for reinvestment into acquisition and debt repayment.
Our Take
Going forward, we believe that Ventas’ adequate size and scale would help it capitalize on opportunities such as increasing healthcare spending, aging population and a rise in insured individuals. Yet, stiff competition and a projected rise in interest rates keep us concerned.
Ventas currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some important REITs which are slated to report next week include Taubman Centers, Inc. , Regency Centers Corporation (REG - Free Report) and Host Hotels & Resorts, Inc. (HST - Free Report) .
VENTAS INC Price, Consensus and EPS Surprise
VENTAS INC Price, Consensus and EPS Surprise | VENTAS INC Quote
Note: All EPS numbers presented in this write-up represent funds from operations (“FFO”) per share. FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>