Analyst Juan C. Sanabria of BMO Capital maintained a Hold rating on CareTrust REIT, retaining the price target of $35.00.
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Juan C. Sanabria has given his Hold rating due to a combination of factors affecting CareTrust REIT’s performance. The company’s normalized Funds Available for Distribution (FAD) for the second quarter of 2025 fell short of expectations, despite an increase in the pipeline and robust deal execution. Although the guidance for 2025 FAD was raised by 1.7%, it still remains below the consensus estimates, as management did not include potential incremental deals in their projections.
Moreover, while there is a positive development with the fading regulatory uncertainty in the Skilled Nursing Facility (SNF) sector and improving operating fundamentals, the company’s financial results, such as the normalized Funds from Operations (FFO) and FAD per share, missed the Street’s expectations. Additionally, the updated guidance for normalized FFO and FAD per share is still below the market’s projections, and the guidance does not factor in potential future acquisitions. These elements contribute to the Hold rating as the outlook remains cautious.