On Thursday, Truist Securities adjusted its outlook on Sabra Healthcare REIT Inc . (NASDAQ: NASDAQ:SBRA), increasing the price target to $16 from the previous $15 while sustaining a Buy rating on the stock. The firm's analyst cited unchanged 2024 and 2025 Net Funds From Operations (NFFO) estimates as the basis for the price target hike, which anticipates a 16% return on investment.
Sabra Healthcare REIT has experienced a 27% rise in its shares over the past 12 months, outperforming the Vanguard Real Estate ETF (VNQ) which saw a 2% increase in the same period. Year to date, SBRA shares have also gained 4%, compared to a 5% decline in VNQ. Despite these gains, the analyst notes that Sabra still trades at a discount when compared to its peers, specifically mentioning National Health Investors (NYSE:NHI) (Hold) and Omega Healthcare (NYSE:OHI) Investors (Hold).
The assessment of Sabra's performance includes a nod to the stability at the start of the year, with the analyst suggesting there is potential for occupancy improvements within the company's managed portfolio. Occupancy rates were reported at 82.5% in the first quarter of 2021, inching up to 82.7% in the fourth quarter of 2023, and are expected to continue to rise into the second quarter of 2024.
Additionally, the analyst anticipates that Sabra Healthcare REIT will engage in accretive acquisitions later in the year, which are not yet factored into the management's guidance. These strategic acquisitions are expected to contribute positively to the company's financial performance.
In other recent news, Sabra Health Care REIT (NYSE:WELL) held its annual stockholder meeting, resulting in the election of eight board members, ratification of PricewaterhouseCoopers LLP as the independent auditor, and advisory approval of executive compensation.
In addition, Sabra Health Care REIT has been making strides in its financial performance, as noted by Citi and Scotiabank. Both firms updated their price target for the company to $15.00, maintaining neutral and Sector Perform ratings respectively.
Citi's analysis projects the core Funds From Operations (FFO) for 2024 to remain stable at $1.36, with a slight reduction for 2025's core FFO to $1.41. Scotiabank, on the other hand, forecasts a steady fiscal year 2024, with expected funds from operations per share (FFOPS) growth of approximately 5% year over year.
Furthermore, Sabra Healthcare REIT reported growth in its first-quarter earnings call, with skilled nursing EBITDA and coverage surpassing pre-pandemic levels. The company also reaffirmed its full-year 2024 guidance and plans to reveal new acquisition deals in the upcoming second-quarter earnings call.
InvestingPro Insights
Recent analysis from InvestingPro aligns with Truist Securities' optimistic outlook on Sabra Healthcare REIT Inc. (NASDAQ: SBRA). InvestingPro data shows a robust revenue growth of 21.68% over the last twelve months as of Q1 2024, indicating a strong financial performance. Additionally, the company's gross profit margin stands at a healthy 68.98%, reflecting efficient operations and a solid income-generating ability.
InvestingPro Tips suggest that Sabra Healthcare REIT is expected to grow its net income this year and is trading at a low P/E ratio relative to near-term earnings growth, which could signal a valuable investment opportunity. Moreover, the company has been consistent with its dividend payments for 14 consecutive years and currently offers an attractive dividend yield of 8.1%. With liquidity also in a favorable position, as liquid assets exceed short-term obligations, the financial health of SBRA appears sound.
Investors looking to dive deeper into Sabra Healthcare REIT's financials and market position can find additional tips on InvestingPro, including insights on the company's profitability and analyst predictions. For those interested in expanding their investment analysis toolkit, InvestingPro offers a comprehensive suite of tools and data. Use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, and gain access to the numerous additional tips available on the platform.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.