New Senior Investment Group anounced that it expects to complete $296M of asset sales during the fourth quarter of 2017. The transactions include a $186M sale of six triple net leased properties, as well as termination of the related lease with LCS and a $109.5M sale of nine properties managed by Holiday Retirement. Total consideration of $186M for the Leased Portfolio Sale represents a 6.6% cap rate on 2Q 2017 annualized NOI generated by the underlying portfolio, and represents an 8.2% lease yield on 2Q 2017 annualized cash rent. Total consideration of $109.5M for the Managed Portfolio Sale represents a 5.1% cap rate on 2Q 2017 annualized cash NOI. In connection with the transactions, the company expects to repay approximately $178M of existing debt with a weighted average interest rate of approximately 4.6%. After debt repayment, the net proceeds from the transactions will be approximately $117.5M, before fees and expenses. The company intends to use the net proceeds for general corporate purposes, which may include new investments, debt prepayment and/or repurchases of common stock, depending on market conditions.
Catch up on today's top five analyst downgrades with this list compiled by The Fly: 1. BHP Billiton (BHP) downgraded to Underperform from Sector Perform at RBC Capital with analyst Tyler Broda saying that the company's "mature asset base, especially in petroleum, creates medium term pressure on profitability." 2. New Senior Investment (SNR) downgraded to Neutral from Buy at Compass Point. 3. Calpine (CPN) downgraded to Neutral from Outperform at Macquarie. 4. Ctrip.com (CTRP) downgraded to Outperform from Buy at Daiwa with analyst John Choi saying he expects downward Street earnings revisions following results while the uncertainty on cross-sale revenue in the second half will likely cap the stock's performance in the coming 1-2 quarters. 5. Carrefour (CRRFY) downgraded to Neutral from Overweight at JPMorgan with analyst Borja Olcese saying the company "severely missed expectations" in its first half and profit warned for the year. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.
Reports Q2 revenue $114.29M, consensus $114.68M. Reports Q2 adjusted FFO 27c. Total same store cash NOI decreased 1.7% vs. 2Q16. Managed same store cash NOI decreased 6.5% vs. 2Q16. Triple net same store cash NOI increased 4.3% vs. 2Q16.
New Senior Investment initiated with an Underweight at Morgan Stanley. Morgan Stanley analyst Vikram Malhotra initiated New Senior Investment with an Underweight and a $9 price target. The analyst believes the company will struggle to show meaningful growth given higher relative inventory growth, mid to low-end market positioning, and a leveraged balance sheet.