Healthcare Trust of America (NYSE: HTA) and CareTrust REIT (NASDAQ:CTRE) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, risk, valuation, dividends, earnings, profitability and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Healthcare Trust of America and CareTrust REIT, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Healthcare Trust of America 0 0 8 1 3.11
CareTrust REIT 0 4 3 0 2.43

Healthcare Trust of America presently has a consensus price target of $34.50, suggesting a potential upside of 14.28%. CareTrust REIT has a consensus price target of $17.67, suggesting a potential downside of 4.40%. Given Healthcare Trust of America’s stronger consensus rating and higher possible upside, equities analysts clearly believe Healthcare Trust of America is more favorable than CareTrust REIT.

Volatility and Risk

Healthcare Trust of America has a beta of 0.32, suggesting that its share price is 68% less volatile than the S&P 500. Comparatively, CareTrust REIT has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500.

Earnings and Valuation

This table compares Healthcare Trust of America and CareTrust REIT’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Healthcare Trust of America $504.67 million 12.00 $301.67 million $0.21 143.76
CareTrust REIT N/A N/A N/A $0.45 41.07

Healthcare Trust of America has higher revenue and earnings than CareTrust REIT. CareTrust REIT is trading at a lower price-to-earnings ratio than Healthcare Trust of America, indicating that it is currently the more affordable of the two stocks.

Dividends

Healthcare Trust of America pays an annual dividend of $1.20 per share and has a dividend yield of 4.0%. CareTrust REIT does not pay a dividend. Healthcare Trust of America pays out 571.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Healthcare Trust of America has raised its dividend for 4 consecutive years.

Profitability

This table compares Healthcare Trust of America and CareTrust REIT’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Healthcare Trust of America 6.07% 1.42% 0.70%
CareTrust REIT 24.02% 5.76% 3.03%

Institutional & Insider Ownership

70.9% of Healthcare Trust of America shares are owned by institutional investors. Comparatively, 81.7% of CareTrust REIT shares are owned by institutional investors. 1.5% of Healthcare Trust of America shares are owned by insiders. Comparatively, 1.6% of CareTrust REIT shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

About Healthcare Trust of America

Healthcare Trust of America, Inc. is a real estate investment trust. The Company is an owner and operator of medical office buildings (MOBs) in the United States. The Company focuses on owning and operating MOBs that serve healthcare delivery and are located on health system campuses, near university medical centers, or in community core outpatient locations. As of December 31, 2016, the Company’s portfolio consisted of approximately 17.7 million square feet of gross leasable area. As of December 31, 2016, the Company’s portfolio included MOBs, such as single-tenant and multi-tenant, and other healthcare facilities, such as hospitals and senior care. As of December 31, 2016, the Company’s portfolio had 355 buildings located in 31 states. As of December 31, 2016, the Company’s properties were located in various states of the United States, such as Alabama, Arizona, California, Colorado, Florida, Georgia, Hawaii, Illinois, Indiana, Kansas, Maryland, Michigan, Minnesota, Nevada and Utah.

About CareTrust REIT

CareTrust REIT, Inc. is a self-administered, self-managed real estate investment trust. The Company is engaged in the ownership, acquisition and leasing of healthcare-related properties. It makes investments in healthcare-related real estate assets. As of December 31, 2016, its real estate portfolio included 154 skilled nursing facilities (SNFs), SNF Campuses, assisted living facilities and independent living facilities. As of December 31, 2016, the 93 facilities leased to The Ensign Group, Inc. had a total of 9,916 beds and units and are located in Arizona, California, Colorado, Idaho, Iowa, Nebraska, Nevada, Texas, Utah and Washington; the 16 facilities leased to affiliates of Pristine Senior Living, LLC had a total of 1,488 beds and units; and the 42 remaining leased properties had a total of 3,515 beds and units and are located in California, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Maryland, Michigan, Minnesota, North Carolina, Texas, Virginia, Washington and Wisconsin.

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