Analyzing Welltower (HCN) and Community Healthcare Trust (CHCT)
Welltower (NYSE: HCN) and Community Healthcare Trust (NYSE:CHCT) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, analyst recommendations, dividends, earnings, profitability, valuation and institutional ownership.
This table compares Welltower and Community Healthcare Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Community Healthcare Trust||11.30%||1.81%||1.33%|
Volatility & Risk
Welltower has a beta of 0.23, meaning that its share price is 77% less volatile than the S&P 500. Comparatively, Community Healthcare Trust has a beta of 1.04, meaning that its share price is 4% more volatile than the S&P 500.
Valuation and Earnings
This table compares Welltower and Community Healthcare Trust’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Welltower||$4.19 billion||6.26||$2.05 billion||$3.21||22.15|
|Community Healthcare Trust||$30.77 million||10.11||$20.43 million||$0.27||90.86|
Welltower has higher revenue and earnings than Community Healthcare Trust. Welltower is trading at a lower price-to-earnings ratio than Community Healthcare Trust, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
85.2% of Welltower shares are owned by institutional investors. Comparatively, 59.0% of Community Healthcare Trust shares are owned by institutional investors. 0.2% of Welltower shares are owned by insiders. Comparatively, 5.5% of Community Healthcare Trust shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
This is a breakdown of current recommendations and price targets for Welltower and Community Healthcare Trust, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Community Healthcare Trust||0||0||1||0||3.00|
Welltower currently has a consensus price target of $72.58, suggesting a potential upside of 2.09%. Community Healthcare Trust has a consensus price target of $26.50, suggesting a potential upside of 8.03%. Given Community Healthcare Trust’s stronger consensus rating and higher possible upside, analysts clearly believe Community Healthcare Trust is more favorable than Welltower.
Welltower pays an annual dividend of $3.48 per share and has a dividend yield of 4.9%. Community Healthcare Trust pays an annual dividend of $1.56 per share and has a dividend yield of 6.4%. Welltower pays out 108.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Community Healthcare Trust pays out 577.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Welltower has increased its dividend for 7 consecutive years.
Welltower beats Community Healthcare Trust on 10 of the 17 factors compared between the two stocks.
Welltower Company Profile
Welltower Inc. invests with seniors housing operators, post-acute providers and health systems to fund real estate and infrastructure. The Company invests in seniors housing and healthcare real estate. It operates in three segments: triple-net, seniors housing operating and outpatient medical. Welltower, a real estate investment trust (REIT), owns interests in properties concentrated in markets in the United States, Canada and the United Kingdom, consisting of seniors housing and post-acute communities, and outpatient medical properties. Its triple-net properties include independent living facilities, independent supportive living facilities (Canada), continuing care retirement communities, assisted living facilities, care homes with and without nursing (the United Kingdom), Alzheimer’s/dementia care facilities, long-term/post-acute care facilities and hospitals. Its outpatient medical properties include outpatient medical buildings.
Community Healthcare Trust Company Profile
Community Healthcare Trust Incorporated is an integrated healthcare real estate company. The Company owns and acquires, or finances, real estate properties that are leased to hospitals, doctors, healthcare systems or other healthcare service providers in non-urban markets. It has investments in healthcare real estate, including mortgage and other loans. The Company’s medical office buildings are located in areas, such as, Florida, Georgia, Illinois, Kentucky, Ohio and Texas. Its physician clinics are located in Alabama, Florida, Kansas, Pennsylvania and Wisconsin. Its surgical centers and hospitals are located in areas, such as Louisiana, Michigan and Arizona. Its behavioral facilities are located in Indiana and Illinois. Its specialty centers are located in Texas, Colorado and Alabama, among others. As of December 31, 2016, the Company had interests in 57 real estate properties and one mortgage note, located in 22 states, totaling over 1.33 million square feet in the aggregate.
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