| Over a week ago | ||||
Reports Q4 revenue $165M,… Reports Q4 revenue $165M, consensus $160.63M. Rick Matros, CEO and Chair, said, "Operationally, while still a difficult environment primarily due to labor issues, our portfolio is quite stable. Skilled nursing and senior housing occupancy have both held steady so far this winter. Fortunately, we have not seen much impact from the flu at this point. We have made substantial progress on our asset recycling initiative. In addition, completing the transition of the North American facilities is a material upgrade in corporate credit quality. We expect 2023 to be relatively quiet as we focus our efforts on continued recovery from the pandemic and building investor confidence in our asset classes with an eye on getting back to earnings growth in 2024." | ||||
| Over a month ago | ||||
Sabra Health Care REIT… Sabra Health Care REIT (SBRA) announced that since September 30 the Company has received roughly $185M of gross proceeds related to previously disclosed disposition activity. In addition, the 24 properties formerly leased to North American have been successfully transitioned to Ensign (ENSG) and the Avamere Family of Companies . The disposition activity was almost entirely comprised of skilled nursing investments, including a sizable portfolio which sold for over $200,000 per bed and a cash yield in the mid-single digit range for the twelve-month period ending September 30. In aggregate, the cash yield on this disposition activity was approximately 7% for the twelve-month period ending September 30. The net proceeds from the disposition activity were used to repay borrowings under the Company's revolving credit facility. "We are pleased to announce the proceeds from this disposition activity as part of our previously communicated capital recycling strategy. We remain committed to thoughtfully allocating capital and prudently managing our balance sheet in this uncertain macro environment. We are also pleased to expand our relationship with Ensign and Avamere through the successful transition of the 24 properties formerly leased to North American," said Rick Matros, Sabra's CEO and Chair. | ||||
| Over a quarter ago | ||||
JMP Securities analyst… JMP Securities analyst Aaron Hecht downgraded Sabra Health Care to Market Perform from Outperform without a price target. A return to normalcy from COVID "remains elusive" and rising capital costs should negatively impact the stock's valuation, Hecht tells investors in a research note. The analyst believes investors need improved transparency on future operator cashflows and rent coverage before valuations across the space will materially improve. He sees Sabra as fairly valued at current levels. | ||||
BofA analyst Joshua… BofA analyst Joshua Dennerlein downgraded Sabra Health Care to Underperform from Neutral with a price target of $13, down from $15, updating his valuation model after the company's Q3 results. The analyst states that it is "puzzling" why Sabra would transition a portfolio with healthy coverage to new operators and offer a rent cut. Dennerlein adds that the quarter offered little clarity and opened questions regarding the strength of the company's lease agreements with its tenants. | ||||
BofA analyst Joshua… BofA analyst Joshua Dennerlein downgraded Sabra Health Care to Underperform from Neutral with a $33 price target. | ||||
Sabra Health Care (SBRA)… Sabra Health Care (SBRA) announced that it will transition the 24-property portfolio previously leased to North American Health Care, Inc. to two of Sabra's existing tenants, The Ensign Group (ENSG) and the Avamere Family of Companies. After giving effect to this transition, Ensign will become one of Sabra's largest tenants, representing about 8% of Annualized Cash NOI, while Avamere will remain one of Sabra's largest tenants, also accounting for roughly 8% of Annualized Cash NOI. Sabra believes this transition represents a unique opportunity to improve the long-term value of this high-quality real estate portfolio, noting the enhanced credit profile that supports its rental income, highlighted by Ensign's corporate guaranty and $5 billion equity market capitalization. The transition of these facilities to Ensign operating companies and Avamere is expected to be completed by February 1, 2023 and remains subject to the completion of certain regulatory approvals and other closing conditions. Sabra expects to recognize a total of $14.7 million in revenue from these facilities during the fourth quarter through the end of the transition period, which approximates the rent Sabra would have received during this timeframe under the previous leases with North American. | ||||
Reports Q3 revenue… Reports Q3 revenue $140.76M, consensus $155.21M. Commenting on the third quarter's results, Rick Matros, CEO and Chair, said, "The transition of the North American portfolio should enhance the durability of Sabra's earnings stream going forward. We appreciate the extension of the Public Health Emergency as the health care industry continues to navigate the challenging operating environment. Although the recovery in both the skilled and senior housing asset classes has been slower than we all would have preferred, we are heartened by the continued, albeit slow, improvement in the labor market which has been a major barrier to a quicker recovery. The asset sales we previously disclosed are proceeding as expected and we continue to receive interest in acquiring additional skilled nursing assets. We plan on continuing this strategy which will further diversify our asset classes and fund our ongoing investment activity." | ||||
Baird analyst David… Baird analyst David Rodgers downgraded Sabra Health Care REIT to Neutral from Outperform with a $13 price target. The analyst reduced estimates across his diversified real estate investment trust coverage for a "higher-for-longer" rate outlook and what he expects will be ongoing revisions lower in both fundamental expectations and a longer period of price discovery in the investment sales market. The analyst downgraded a handful of names to reflect a combination of "challenged fundamentals, solid outperformance and/or a pending sentiment reset." | ||||
Reports Q2 revenue… Reports Q2 revenue $156.0M, consensus $155.4M. Commenting on the second quarter's results, Rick Matros, CEO and Chair, said, "Our perspective is that we have moved from the pandemic phase of COVID-19 to endemic. Occupancy is increasing, albeit still hampered by labor shortages. Hiring has improved and agency utilization is coming down, but this will take time. Our portfolio continues to be resilient. Our cash collections remain in line with where they have been. Anticipated dispositions, which are primarily comprised of skilled nursing facilities, will leave us with a more diversified portfolio. We are comfortable with our leverage being temporarily elevated as we await these disposition proceeds and we see no need to access the capital markets as we look out to the rest of 2022. We are pleased with the progress we are making as we expand our footprint in behavioral health, including the adaptive re-use of existing assets which create value in obsolete properties, fill a need for those services and create jobs in those communities. On the reimbursement side, Medicaid is an important source of revenue for the skilled nursing industry and we feel very good about the increases we are seeing in those rates, which creates a smoother path to recovery as the federal assistance we have been accustomed to expires over time. We also appreciate the recently announced net 2.7% increase in Medicare rates for skilled nursing facilities, which is 340 bps higher than what was initially proposed." | ||||
