Critical Comparison: LTC Properties (LTC) & Welltower (HCN)
LTC Properties (NYSE: LTC) and Welltower (NYSE:HCN) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, risk, institutional ownership, earnings and analyst recommendations.
Valuation & Earnings
This table compares LTC Properties and Welltower’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|LTC Properties||$167.79 million||10.99||$147.45 million||$2.28||20.44|
|Welltower||$4.19 billion||5.91||$2.05 billion||$3.21||20.92|
Insider and Institutional Ownership
81.1% of LTC Properties shares are owned by institutional investors. Comparatively, 85.8% of Welltower shares are owned by institutional investors. 1.5% of LTC Properties shares are owned by company insiders. Comparatively, 0.2% of Welltower shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
This is a breakdown of current ratings and target prices for LTC Properties and Welltower, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
LTC Properties currently has a consensus price target of $50.17, suggesting a potential upside of 7.63%. Welltower has a consensus price target of $72.69, suggesting a potential upside of 8.24%. Given Welltower’s stronger consensus rating and higher probable upside, analysts clearly believe Welltower is more favorable than LTC Properties.
LTC Properties pays an annual dividend of $2.28 per share and has a dividend yield of 4.9%. Welltower pays an annual dividend of $3.48 per share and has a dividend yield of 5.2%. LTC Properties pays out 100.0% 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 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. LTC Properties has increased its dividend for 7 consecutive years and Welltower has increased its dividend for 5 consecutive years.
Risk and Volatility
LTC Properties has a beta of 0.16, indicating that its share price is 84% less volatile than the S&P 500. Comparatively, Welltower has a beta of 0.24, indicating that its share price is 76% less volatile than the S&P 500.
This table compares LTC Properties and Welltower’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Welltower beats LTC Properties on 10 of the 17 factors compared between the two stocks.
LTC Properties Company Profile
LTC Properties Inc. is a healthcare real estate investment trust (REIT). The Company invests in senior housing and healthcare properties through sale-leaseback transactions, mortgage financing and structured finance solutions, including mezzanine lending. It invests in various properties, including Skilled nursing facilities (SNF), Assisted living facilities (ALF), Independent living facilities (ILF), Memory care facilities (MC) and Range of care facilities (ROC). SNF provides restorative, rehabilitative and nursing care. Many skilled nursing facilities provide ancillary services that include occupational, speech, physical, respiratory and IV therapies, as well as sub-acute care services, which are paid either by the patient, the patient’s family, private health insurance, or through the federal Medicare or state Medicaid programs. ALF serves people requiring assistance with activities of daily living, but do not require the constant supervision skilled nursing facilities provide.
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.
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