LTC Properties Inc.
(
LTC
), a healthcare real estate investment trust (REIT), has recently
declared a monthly dividend of 14.5 cents per share for the second
quarter of 2012. The dividend is payable in cash on the last
working day of each of the respective month in the quarter.
Earlier in first quarter 2012, LTC Properties had increased its
monthly dividend payout by about 3.6% compared to the last dividend
paid in the previous months of the earlier quarter.
A steady dividend payout facilitates the long-term strategy of
LTC Properties to provide attractive risk-adjusted returns to its
stockholders. Investors looking for high dividend yields are
increasingly favoring REITs like LTC Properties. Solid dividend
payouts are arguably the biggest enticement for REIT investors as
the U.S. law requires REITs to distribute 90% of their annual
taxable income in the form of dividends to shareholders.
LTC Properties primarily invests in long-term care and other
healthcare-related properties through mortgage loans, property
lease transactions, and other investments. The company usually
leases its healthcare facilities under "triple net" leases, under
which the tenant pays all taxes, insurance, and maintenance for the
properties, in addition to rent. This insulates the company from
short-term market swings that may adversely affect the operations
of a particular facility, and provides a relatively steady source
of income.
Healthcare is also relatively immune to the economic problems
faced by office, retail and apartment companies. Consumers will
continue to spend on healthcare while cutting out discretionary
purchases. The healthcare industry is the single largest industry
in the U.S.based on Gross Domestic Product (
GDP
), and an aging Baby Boomer generation's demand for assisted and
independent living facilities should increase in the coming
years.
Consequently, healthcare REITs like LTC Properties is
well-poised to benefit from the long-term positive dynamics of the
industry. We presently have a Neutral recommendation on LTC
Properties, which currently has a Zacks #3 Rank that translates
into a short-term Hold rating. We also have a Neutral
recommendation and a Zacks #3 Rank for
Health Care REIT Inc.
(
HCN
), one of the competitors of LTC Properties.
HEALTH CR REIT (
HCN
): Free Stock Analysis Report
LTC PROPERTIES (
LTC
): Free Stock Analysis Report
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