These Healthcare REITs have declined 15-20% in the last few months. Which are bargains? Which are quality? Should you buy now or later?
The Healthcare REITs have been in correction mode since July-August. These are rather quick and strong declines, too.
Could it be time to start shopping for bargains?
Let’s explore some of the most popular Healthcare REITs and see which one(s) you may be interested in owning for juicy yields and price appreciation potential.
Recent decline overview
The Healthcare REITs, including Welltower Inc. (NYSE:HCN), Ventas, Inc. (NYSE:VTR), HCP, Inc. (NYSE:HCP), and Omega Healthcare Investors Inc. (NYSE:OHI) have fallen 15-20% in the past few months. So, now is a great time to determine which ones may be ripe for buying for a high income.
The correction so far indicates that Welltower and Ventas are the higher-quality REITs. However, valuation could play a role in the severity of the declines, too.
This situation also shows that if capital preservation is a top priority, it’d make sense to take some chips off the table when stocks trade near or at overbought territories (unless you need the income they generate).
However, it’d be better to confirm that the stocks are overpriced by checking their valuations. After all, undervalued stocks can stay overbought for months and steadily move higher.
At about $66 per share, Welltower trades at a P/FFO of 14.4, which is within fair valuation.
At about $62 per share, Ventas trades at a P/FFO of 15, which is within fair valuation.
Unfortunately, I’ve maxed out the number of words I can include in this excerpt which originated from my Seeking Alpha article. However, you can read the full article here: Big Dividends For Sale From These Healthcare REITs
We’ll probably see lots of volatility leading up to the presidential election in the U.S. Long-term investors can begin to research to see if they want to own some Healthcare REITs for a high initial income.
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Disclaimer: I am not a certified financial advisor. This article is for educational purposes, so consult a financial advisor and or tax professional if necessary before making any investment decisions.
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