Target Healthcare REIT (THRL – Research Report), the Real Estate sector company, was revisited by a Wall Street analyst yesterday. Analyst Denese Newton from Stifel Nicolaus maintained a Buy rating on the stock and has a p90.00 price target.
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Denese Newton has given his Buy rating due to a combination of factors influencing Target Healthcare REIT’s positive outlook. The company has shown consistent growth in its earnings, with a 2.6% increase in Q2, driven by both like-for-like growth and contributions from new developments. Additionally, the net tangible assets (NTA) increased by 0.9%, aligning with forecasts, and reflecting stable yields and rental growth.
Target Healthcare REIT’s balance sheet remains robust with a low loan-to-value (LTV) ratio of 22%, and the company has already secured indicative terms for refinancing its debt, which is expected to slightly increase the cost of debt. The company’s high-quality portfolio, with index-linked rents and strong rental cover, continues to support stable portfolio valuation. Despite broader sector challenges, Target Healthcare REIT’s shares have performed well, with a 3.5% increase over the past year, outpacing the declining UK EPRA Index. The attractive dividend yield of 6.7% and strong trading outlook further reinforce the Buy rating.