KeyBanc Upgrades Welltower On Expected Recovery In Senior Housing

Welltower Inc WELL is likely to be among the key beneficiaries of a potential rebound in senior housing, according to KeyBanc Capital Markets.

The Welltower Analyst: Todd Thomas upgraded Welltower from Sector Weight to Overweight and maintained a $70 price target. 

The Welltower Thesis: The company generates around 60% of its net operating income from senior housing, which is higher than its health care REIT peers, Thomas said in the upgrade note.

“WELL has demonstrated an active commitment to capital allocation and balance sheet management that helped to mitigate downside during the pandemic and should be a source of upside, as the vaccine-led recovery unfolds in 2021,” the analyst said. 

Pfizer’s PFE positive vaccine announcements resulted in a “swift rotation out of growth and into value stocks,” he said.

Thomas said he expects markets to continue favoring “value-oriented, COVID-19-sensitive REITs that stand to benefit from a fundamental recovery,” and reverse “much of the pandemic trade.”

WELL Price Action: Shares of Welltower were down 0.79% at $63.74 at last check Monday.