Welltower Has a Strong Month After Impressive Third Quarter Earnings – Welltower OP (NYSE: WELL)

A leading real estate investment trust (REIT) moved higher on November 8 after it reported third-quarter funds from operations (FFO) met expectations and revenue beat them. Welltower Inc. Well Largely benefiting from the news was that the company had quarterly FFO per share of $0.84, which was better than the $0.80 figure a year earlier.

The REIT’s third-quarter revenue came in at $1.47 billion, up 18% compared to last year’s results. From headquarters in Toledo, Ohio, WellTower operates healthcare facilities including senior housing, post-acute care and health systems.

After opening higher by over 11%, the REIT cooled off during the trading session and managed to maintain a gain of 8.8% for the day. The REIT has since captured most of those gains and is now up 12.86% for the month.

Welltower has a market capitalization of $31.3 billion, placing it in the “dominant” group of real estate investment trusts. Average daily volume for the large healthcare REIT is 2.67 million shares.

On November 1, analysts at Credit Suisse reiterated their outperform rating on the company and reduced the price target to $75 from $100. Analysts at Raymond James recently lowered their outlook on Welltower to Outperform from Strong Buy to $70 from $81.

The REIT continues to pay a 3.67% dividend.

Here is the daily price chart of Welltower:

The difference in price takes it above the 50-day moving average, a move that looks bullish for the REIT. Heavier-than-usual volume is also a good sign, confirming the strength of the move.

This is the weekly chart:

Welltower has a long way to go to recapture the momentum it saw in 2021 and earlier this year. This is a highly visible bounce from the September/October lows, which makes it look better than most other names in the real estate investment group right now.

Such REITs will be deeply affected by the Federal Reserve’s decisions on raising interest rates, with concerns about how high they will rise and for how long. Investors will be looking for clues with the latest Consumer Price Index readings for the month of October, released on November 10.

REITs are one of the most misunderstood investment options, making it difficult for investors to spot incredible opportunities until it’s too late. Benzinga’s in-house real estate research team is hard at work identifying the biggest opportunities in today’s market, which you can access for free by signing up. Benzinga’s Weekly REIT Report.

Chart courtesy of Stockcharts

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