On Friday, Baird, a financial services firm, increased its stock price target for Sabra Healthcare REIT Inc . (NASDAQ:SBRA) to $16.00, up from the previous $15.00, while retaining a Neutral rating on the stock. The adjustment follows Baird's updated projections for the company's Normalized Adjusted Funds From Operations (AFFO) per share for the coming years.
Baird now estimates that Sabra Healthcare will post Normalized AFFO per share of $1.42 for 2024, $1.48 for 2025, and $1.53 for 2026. These figures are slightly adjusted from the firm's earlier predictions of $1.41, $1.47, and $1.54 for the respective years. The revisions reflect a nuanced outlook for the company's financial performance over the next few years.
The firm anticipates that Sabra's Senior Housing managed portfolio will persist in producing significant growth. Moreover, the Skilled Nursing Facility (SNF) portfolio is expected to see higher coverage ratios, bolstered by increasing occupancy rates. These positive factors have contributed to Baird's decision to revise the price target upward.
Furthermore, Baird suggests that while external growth for Sabra Healthcare is anticipated to rise, the exact timing of such deals remains uncertain. Despite this lack of clarity, the perceived increase in the company's Net Asset Value (NAV) per share has been a key factor in the revised price target.
The updated stock price target of $16.00 reflects Baird's assessment of Sabra Healthcare's potential performance and growth prospects, based on the company's current and projected financial metrics.
In other recent news, Sabra Health Care REIT (NYSE:WELL), Inc. conducted its annual meeting of stockholders where significant decisions were made concerning the company's governance and executive compensation. The company elected eight board members, ratified PricewaterhouseCoopers LLP as the independent auditor, and received advisory approval of executive compensation.
In the realm of financial performance, Sabra Healthcare REIT has been making strides. Citi and Scotiabank both updated their price targets for the company to $15.00, maintaining a neutral stance and a sector perform rating respectively. The firms' analysis projects the core Funds From Operations (FFO) for 2024 to remain stable, with a slight reduction for 2025's core FFO.
Sabra Healthcare REIT also reported growth in its first-quarter earnings call, with skilled nursing EBITDA and coverage surpassing pre-pandemic levels. The company has reaffirmed its full-year 2024 guidance and plans to reveal new acquisition deals in the upcoming second quarter earnings call. These are recent developments that investors should take into account when considering Sabra Healthcare REIT.
InvestingPro Insights
With Baird's recent price target increase for Sabra Healthcare REIT Inc. (NASDAQ:SBRA), investors may find additional context through real-time metrics and insights from InvestingPro. Sabra's market capitalization stands at a robust $3.36 billion, indicating a significant presence in the healthcare REIT sector. Moreover, the company's P/E ratio, based on the last twelve months as of Q1 2024, is adjusted to 31.56, reflecting investors' willingness to pay a premium for its earnings compared to historical averages.
InvestingPro Tips suggest that Sabra is expected to see net income growth this year, which aligns with Baird's outlook for increased Normalized AFFO per share. Additionally, Sabra is trading at a low P/E ratio relative to near-term earnings growth, which could signal an attractive entry point for value-oriented investors.
Notably, the firm pays a significant dividend to shareholders, boasting a dividend yield of 8.28% as of the most recent data, and has maintained dividend payments for 14 consecutive years, emphasizing its commitment to returning value to investors.
For those considering deeper analysis, InvestingPro offers more tips on Sabra Healthcare, which can be explored at https://www.investing.com/pro/SBRA. Investors can also take advantage of an additional 10% off a yearly or biyearly Pro and Pro+ subscription with the promo code PRONEWS24. With these insights, stakeholders can better gauge Sabra Healthcare's investment potential alongside the company's strategic growth in the Senior Housing and Skilled Nursing Facility portfolios.
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