Brookdale Senior Living, Inc. (NYSE:BKD) is valued at $3.57 billion, does not pay out a dividend, and carries a negative price to earnings ratio. Brookdale is an owner and operator of senior living communities throughout the United States, and competes directly with HCP. Fundamentally, the company’s business model is weak, with a TTM profit margin of -1.85%.
Health Care REIT, Inc. (NYSE:HCN) is valued at $19.45 billion, pays out a dividend yielding 4.53%, and carries a price to earnings ratio of 274.15. Health Care’s portfolio spans across nearly all breeds of health care real estate properties. Fundamentally, the company’s business model has been substantially weakening over the past 5 years, with the company’s TTM profit margin declining from the 60% level to the current 15.29% mark.
National Health Investors Inc (NYSE:NHI) is valued at $1.76 billion, pays out a dividend yielding 4.66%, and carries a price to earnings ratio of 24.42. The bulk of National Health’s portfolio is comprised of long-term care and senior housing facilities. The company’s business model is incredibly strong with a TTM profit margin of 89.45%.
LTC Properties Inc (NYSE:LTC) is valued at $1.37 billion, pays out a dividend yielding 4.44%, and carries a price to earnings ratio of 26.60. LTC’s real estate portfolio consists of mainly senior housing facilities, with its properties competing with HCP’s and the other competitors’ holdings. Fundamentally, the company’s business model is proven and solid, with a TTM profit margin of 52.90%.
The Foolish Bottom Line
Financially, HCP, Inc. (NYSE:HCP) is relatively solid. The company possesses a proven track record of consistent and solid revenue growth, a growing dividend, and a diversified property portfolio. Despite the company’s high valuation and net debt position, the company’s business model is extremely predictable and sustainable. Looking forward, the company is likely to sustain its rate of growth by reinvesting in its business through cash flow generated through its properties. All in all, HCP earns five out of five stars, and is an extremely stable investment that should hand investors returns that outperform the overall market for years to come.
Ryan Guenette has no position in any stocks mentioned. The Motley Fool recommends Health Care REIT. Ryan is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
The article A Health Care REIT Capitalizing on the Aging Population of the United States originally appeared on Fool.com and is written by Ryan Guenette.
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