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Ventas Soars to a New 52-Week High - Analyst Blog
Shares of Ventas Inc. ( VTR ) soared to a new 52-week high of $72.20 on Tuesday, Mar 26, 2013, as it gained momentum following decent fourth-quarter 2012 results. The closing price of this real estate investment trust (REIT) on Mar 26, 2013, was $71.99, representing a solid year-to-date return of 10.5%.
The stock has further advanced to $72.11 on Mar 27, 2013. The
average trading volume over the last 3 months was nearly 1.0
Despite hitting its 52-week high, this Zacks Rank #3 (Hold) stock has plenty of upside left given its strong estimate revisions following the earnings release.
Ventas has one of the largest and most diversified portfolios in the healthcare sector with exposure to all types of facilities. The product diversity of the company allows it to capitalize on opportunities in different markets based on individual market dynamics, and provides a hard-to-replicate business model with sufficient competitive edge over its peers.
Moreover, Ventas has a strong balance sheet, which provides its adequate financial flexibility to aim at high-yielding acquisitions, high ROI (return on investments) capital projects and steady dividend payouts. Notably, Ventas increased its first-quarter 2013 cash dividend by 8% to 67 cents per share.
On Feb 15, 2013, Ventas reported better-than-expected fourth quarter 2012 results. Its normalized FFO reached 99 cents per share in the fourth quarter 2012, 2 cents ahead of the Zacks Consensus Estimate and 10 cents above the prior-year quarter figure.
For full year 2012, the company's normalized FFO came in at $3.80 per share, exceeding the Zacks Consensus Estimate by 1 cent and significantly ahead of the year-ago figure of $3.37 per share. The results were aided by the strategic acquisitions made in 2012 and in the prior year, decent performance of its seniors housing communities and rental escalation from its triple-net lease portfolio.
Notably, Ventas has now delivered positive earnings surprises in 4 straight quarters with an average beat of 2.4%.
Estimate Revisions Show Potency
Over the last 60 days, 5 estimates for 2013 have been revised upward, lifting the Zacks Consensus Estimate by 0.5% to $4.06 per share. Furthermore, 2 estimates for 2014 have moved higher, raising the Zacks Consensus Estimate by 1.2% to $4.29 per share.
In addition to Ventas, a number of REITs crafted 52-week highs recently. This includes Jones Lang LaSalle Incorporated ( JLL ), Duke Realty Corporation ( DRE ) and Highwoods Properties Inc. ( HIW ).
Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
DUKE REALTY CP (DRE): Free Stock Analysis Report
HIGHWOODS PPTYS (HIW): Free Stock Analysis Report
JONES LANG LASL (JLL): Free Stock Analysis Report
VENTAS INC (VTR): Free Stock Analysis Report
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