Morgan Keegan Analyzes Publicly Traded Healthcare REITs (HCP, HCN, VTR, NHP)

In a report released this morning, Morgan Keegan provides an analysis of publicly traded healthcare REITs with respect to FFO/FAD, investment composition, and asset coverage ratios.

“Since our last report, we have seen four noteworthy large deals: HCP, Inc.'s HCP $6.1 billion acquisition of the real estate of HCR Manor Care, Health Care REIT Inc.'s HCN $1.3 billion entry into three senior housing operating joint ventures, Ventas Inc.'s VTR $7.4 billion (announced value, currently $7.1-$7.2 billion, we estimate) acquisition of Nationwide Health Properties Inc. NHP, and Health Care REIT's $2.4 billion acquisition of real estate operated by Genesis HealthCare,” Morgan Keegan writes.

“The ‘big three' getting larger via pricey deals has been the headline of late. For the sector as a whole, though, we believe that the biggest theme to emerge is the need to accelerate FFO growth in order for healthcare REIT shares to compete with those of REITs investing in recovering cyclical assets.”

HCP closed Tuesday at $37.57; Ventas closed at $52.37; Health Care REIT closed at $51.75; and Nationwide Health Properties closed at $40.79.