Omega Healthcare Investors Inc (NYSE:OHI) is an attractive, big-dividend (8.5%), real estate investment trust (REIT).
Omega has delivered poor performance so far this year (as shown in our recent article: Big-Dividend Healthcare REITs, Ranking the Best and Worst (1)) not only because of macroeconomic headwinds that caused REITs to pullback, but also because of heightened Affordable Care Act (ACA) uncertainty (especially following the recent U.S. elections), and because of the market’s overly pessimistic view of skilled nursing facilities (for example, short-interest is significantly high).
We believe these three big risks (i.e. macroeconomic headwinds for REITs, ACA uncertainty, and overly pessimistic sentiment) have created an attractive opportunity for diversified long-term investors.
Omega is a triple-net equity REIT that provides financing to support Skilled Nursing Facility (SNF) operators. And considering the shifting demographics of the US population, Omega has a big tailwind at its back that will help it going forward as shown in the following charts.