Analyzing Ventas (VTR) & Universal Health Realty Income Trust (UHT)

Ventas (NYSE: VTR) and Universal Health Realty Income Trust (NYSE:UHT) are both financials companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, dividends, earnings, profitability and institutional ownership.

Analyst Ratings

This is a summary of current ratings and target prices for Ventas and Universal Health Realty Income Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ventas 5 5 2 0 1.75
Universal Health Realty Income Trust 0 0 0 0 N/A

Ventas currently has a consensus price target of $61.63, indicating a potential upside of 10.98%. Given Ventas’ higher probable upside, analysts plainly believe Ventas is more favorable than Universal Health Realty Income Trust.

Dividends

Ventas pays an annual dividend of $3.16 per share and has a dividend yield of 5.7%. Universal Health Realty Income Trust pays an annual dividend of $2.66 per share and has a dividend yield of 4.0%. Ventas pays out 188.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Universal Health Realty Income Trust pays out 82.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ventas has raised its dividend for 7 consecutive years and Universal Health Realty Income Trust has raised its dividend for 32 consecutive years.

Insider and Institutional Ownership

90.3% of Ventas shares are owned by institutional investors. Comparatively, 60.7% of Universal Health Realty Income Trust shares are owned by institutional investors. 1.3% of Ventas shares are owned by insiders. Comparatively, 1.9% of Universal Health Realty Income Trust shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Ventas and Universal Health Realty Income Trust’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ventas $3.44 billion 5.74 $649.23 million $1.68 33.05
Universal Health Realty Income Trust $67.08 million 13.57 $17.21 million $3.24 20.47

Ventas has higher revenue and earnings than Universal Health Realty Income Trust. Universal Health Realty Income Trust is trading at a lower price-to-earnings ratio than Ventas, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Ventas has a beta of 0.09, suggesting that its stock price is 91% less volatile than the S&P 500. Comparatively, Universal Health Realty Income Trust has a beta of 0.35, suggesting that its stock price is 65% less volatile than the S&P 500.

Profitability

This table compares Ventas and Universal Health Realty Income Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ventas 32.96% 6.34% 2.83%
Universal Health Realty Income Trust 61.38% 8.12% 3.32%

Summary

Universal Health Realty Income Trust beats Ventas on 9 of the 16 factors compared between the two stocks.

About Ventas

Ventas, Inc. is a real estate investment trust (REIT) with its properties located throughout the United States, Canada and the United Kingdom. The Company operates through three segments: triple-net leased properties, senior living operations and office operations. Under its triple-net leased properties segment, the Company invests in and owns seniors housing and healthcare properties throughout the United States and the United Kingdom and leases those properties to healthcare operating companies under triple-net or absolute-net leases that obligate the tenants to pay all property-related expenses. In its senior living operations segment, it invests in seniors housing communities throughout the United States and Canada and engages independent operators to manage those communities. In its office operations segment, the Company primarily acquires, owns, develops, leases and manages medical office buildings (MOBs) and life science and innovation centers throughout the United States.

About Universal Health Realty Income Trust

Universal Health Realty Income Trust is a real estate investment trust (REIT). The Company invests in healthcare and human service related facilities, including acute care hospitals, rehabilitation hospitals, sub-acute facilities, surgery centers, free-standing emergency departments, childcare centers and medical office buildings (MOBs). As of February 28, 2017, the Company had 67 real estate investments located in 20 states in the United States consisting of six hospital facilities, including three acute care, one rehabilitation and two sub-acute; 54 MOBs; three free-standing emergency departments (FEDs), and four preschool and childcare centers. The Company’s facilities include Southwest Healthcare System, Inland Valley Campus, Wellington Regional Medical Center, Kindred Hospital Chicago Central, Vibra Hospital of Corpus Christi, Chesterbrook Academy, and Desert Valley Medical Center.

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