Welltower Inc. Shines in Healthcare REIT Sector Despite Recent Slips
Company’s Performance Highlights Financial Strength and Growth Potential
Welltower Inc. (WELL), based in Toledo, Ohio, stands as a prominent real estate investment trust (REIT) focused on health care infrastructure. With a market cap of $80.5 billion, Welltower invests in leading senior housing operators, post-acute care providers, and health systems, enabling the necessary infrastructure for enhanced treatment.
As a large-cap stock—defined as companies valued at $10 billion or more—WELL exemplifies significant size and influence within the REIT healthcare facilities industry. Its global reach takes advantage of current healthcare trends for growth, backed by a skilled management team that drives its strategic decisions. The diversified portfolio across various healthcare sectors enhances risk management, giving Welltower a competitive advantage.
However, despite its solid footing, WELL shares have declined 8.6% from their 52-week peak of $140.75, reached on Nov. 27. In the past three months, WELL stock has seen a slight decrease but still performed better than the iShares Residential and Multisector Real Estate ETF (REZ), which experienced a 5.6% loss during the same period.
Over the longer term, WELL’s stock has increased 42.6% year-to-date (YTD) and has gone up 46% over the past year, outpacing REZ’s YTD growth of 14.8% and its 21.8% returns in the same timeframe.
Encouragingly, WELL has consistently traded above its 200-day moving average over the past year. Despite positive trends, it has recently traded below its 50-day moving average.
A significant driver of Welltower’s success is its performance in the thriving aging population market. With a remarkable 12.6% total same-store net operating income growth and a substantial 23% increase in its senior housing portfolio, the company is well-positioned. As the senior population grows, demand for healthcare services is expected to escalate, leading to higher spending in the sector.
On Oct. 28, WELL shares saw a slight increase following their Q3 earnings report. The company reported revenue of $2.1 billion, surpassing Wall Street’s prediction of $2 billion. Additionally, its funds from operations (FFO) reached $1.11, exceeding analysts’ expectations of $1.04. Welltower anticipates its full-year FFO to fall between $4.27 and $4.33.
Meanwhile, Omega Healthcare Investors, Inc. (OHI), a competitor, has seen a YTD increase of 26.7% and 25.9% growth in the past year, indicating the competitive landscape of the sector.
Wall Street analysts continue to hold a moderately positive view on WELL’s future. Currently, 19 analysts provide a consensus rating of “Moderate Buy,” and the average price target of $140.17 indicates a potential rise of 9% from current price levels.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
