Creator: Patrick Connole
Welltower Upgrade Talk Puts a Shine on Stock Price
Welltower’s stock price experienced a boost this week when a Wall Street analyst upgraded his target price for the REIT active in the long-term care sector.
Although Friday (Sept. 25) has seen investors selling off a slice of the Thursday advance in Welltower’s (NYSE: WELL) stock price, the outlook remains rosy for the healthcare-focused REIT big in the senior housing sector, analysts said.
Shares of Welltower climbed on Thursday despite an overall slack S&P market performance due to analyst Michael Mueller of JPMorgan changing his rating for the REIT from neutral to overweight, setting a $260 per share target price, 11 percent higher than Welltower’s Thursday close of $233.61 per share.
A related report in The Motley Fool said the JPMorgan analyst cited multi-year growth prospects and net operating income growth as the basis for the upgrade.
“Mueller's adjustment was part of a broader reevaluation of J.P. Morgan's REIT coverage, according to reports. The analyst believes that the prospects for Welltower are clearly positive, and the company is poised for several years of better-than-average growth,” the Fool said.
Mueller pointed to Welltower’s ability “to post impressive net operating income growth, writing that this is not only impressive for a healthcare REIT, but also admirable for any company in the sector.”
The Motley Fool’s own take on the stock said it generally agreed with Mueller but cautioned that “the steadily rising popularity of this stock as a top pick among REITs has lowered its dividend yield considerably. This stands at 1.5 percent, well below the high-yield dividends that predominate in the REIT sector. While I like Welltower as a company, I think better and more lucrative investment opportunities lie in other REITs” without naming them.
Comments or questions? Contact Patrick Connole at pconnole@parkplacelive.com
