Ventas (VTR) AI Stock Analysis

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Ventas

(NYSE:VTR)

60Neutral

Ventas shows strong revenue growth and improved debt management, but struggles with profitability and cash flow consistency. While the earnings call provided a positive outlook with strong performance in senior housing, the valuation appears stretched. Technical indicators are mixed, reflecting potential stock price consolidation. Overall, the stock maintains moderate potential, bolstered by strategic focus in the senior housing sector.

Positive Factors

Financial Performance

Ventas Inc reported a 4Q24 Normalized FFO of $0.81, beating expectations and driven by favorable interest expense.

Investment and Growth

Ventas expects to close $1Bn of Senior housing investments in 1H25.

Market Position

VTR is well positioned to benefit from limited senior housing deliveries and a growing 80+ population.

Negative Factors

Guidance

Shares may initially react negatively given the beat and improved acquisitions without a guidance bump.

Research and Development

Research is also a risk given lab/NIH pressures.

Ventas (VTR) vs. S&P 500 (SPY)

Market Cap

$29.44B

Dividend Yield2.61%

Average Volume (3M)3.68M

Price to Earnings (P/E)336.3

Beta (1Y)0.51

Revenue Growth10.00%

EPS GrowthN/A

CountryUS

Employees498

SectorReal Estate

Sector Strength80

IndustryREIT - Healthcare Facilities

Share Statistics

EPS (TTM)0.19

Shares Outstanding437,697,800

10 Day Avg. Volume2,860,805

30 Day Avg. Volume3,683,299

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap1.30

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit18.31

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$74.92

Price Target Upside12.56% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering13

Ventas Business Overview & Revenue Model

Company DescriptionVentas, an S&P 500 company, operates at the intersection of two powerful and dynamic industries: healthcare and real estate. As one of the world's foremost Real Estate Investment Trusts (REIT), we use the power of capital to unlock the value of real estate, partnering with leading care providers, developers, research and medical institutions, innovators and healthcare organizations whose success is buoyed by the demographic tailwind of an aging population. For more than twenty years, Ventas has followed a successful strategy that endures: combining a high-quality diversified portfolio of properties and capital sources to manage through cycles, working with industry leading partners, and a collaborative and experienced team focused on producing consistent growing cash flows and superior returns on a strong balance sheet, ultimately rewarding Ventas shareholders. As of September 30, 2020, Ventas owned or managed through unconsolidated joint ventures approximately 1,200 properties.

How the Company Makes MoneyVentas generates revenue primarily through leasing its real estate properties to a diverse group of tenants in the healthcare and senior living industries. The company earns rental income from long-term lease agreements with operators of senior housing communities, medical office buildings, and other healthcare facilities. Additionally, Ventas benefits from property management fees and may also engage in development and redevelopment projects that enhance the value of its portfolio. The company's earnings are supported by strategic partnerships with leading healthcare operators and a focus on maintaining high occupancy rates across its properties. Ventas's diversified asset base and strategic relationships enable it to capitalize on trends in the healthcare sector, contributing to its financial stability and growth.

Ventas Financial Statement Overview

Summary

Ventas demonstrates strong revenue growth and improved debt management, indicating potential for financial stability. However, the company struggles with profitability, highlighted by low net profit margins and inconsistent cash flow performance. Improving operational efficiency and cash management remains crucial for financial health.

Income Statement

Neutral

Ventas showed a strong revenue growth rate of 9.48% from 2022 to 2023, and further growth of 9.47% from 2023 to 2024. However, despite this growth, net profit margins have been persistently low or negative, with a slight improvement in 2024 to 0.00%. EBIT and EBITDA margins indicate operational efficiency but are inconsistent with net income performance.

Balance Sheet

Positive

The company's debt-to-equity ratio improved significantly in 2024, with zero debt reported, enhancing the equity ratio to 41.13%. Return on equity (ROE) remains weak due to low net income. Overall, the balance sheet shows reduced leverage, contributing to financial stability.

Cash Flow

Neutral

Cash flow metrics are concerning, with no free cash flow or operating cash flow reported in 2024. Previous years showed positive free cash flow and a strong operating cash flow to net income ratio. The absence of cash flow data in 2024 raises questions about cash management.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
4.92B	4.50B	4.13B	3.83B	3.80B
	Gross Profit
2.10B	770.72M	1.85B	1.74B	1.86B
	EBIT
0.00	665.12M	454.08M	389.30M	592.58M
	EBITDA
1.94B	1.83B	1.65B	1.60B	1.72B
	Net Income Common Stockholders
81.15M	-40.97M	-40.93M	49.01M	439.15M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
897.85M	508.79M	122.56M	149.72M	413.33M
	Total Assets
26.19B	24.73B	24.16B	24.72B	23.93B
	Total Debt
13.74B	13.69B	12.92B	12.22B	12.11B
	Net Debt
12.84B	13.18B	12.79B	12.08B	11.69B
	Total Liabilities
15.36B	14.88B	13.94B	13.77B	13.65B
	Stockholders Equity
10.77B	9.49B	10.15B	10.85B	10.18B
Cash Flow		Free Cash Flow
725.78M	935.13M	666.09M	593.15M	921.53M
	Operating Cash Flow
1.33B	1.12B	1.12B	1.03B	1.45B
	Investing Cash Flow
-2.38B	-184.66M	-859.22M	-724.14M	154.29M
	Financing Cash Flow
1.45B	-543.75M	-283.93M	-558.47M	-1.30B

Ventas Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price66.56

Price Trends

50DMA

67.48

Negative

100DMA

63.53

Positive

200DMA

62.06

Positive

Market Momentum

MACD

0.25

Positive

RSI

46.74

Neutral

STOCH

46.50

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VTR, the sentiment is Neutral. The current price of 66.56 is below the 20-day moving average (MA) of 67.06, below the 50-day MA of 67.48, and above the 200-day MA of 62.06, indicating a neutral trend. The MACD of 0.25 indicates Positive momentum. The RSI at 46.74 is Neutral, neither overbought nor oversold. The STOCH value of 46.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for VTR.

Ventas Risk Analysis

Ventas disclosed 52 risk factors in its most recent earnings report. Ventas reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Ventas Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CTRE	80 Outperform	$5.46B	36.19	5.76%	4.12%	36.06%	61.55%
WELL	78 Outperform	$98.56B	162.48	3.52%	1.74%	23.31%	36.07%
OHI	74 Outperform	$11.07B	25.67	10.02%	6.95%	9.90%	56.41%
DOC	69 Neutral	$12.99B	44.81	3.26%	6.78%	23.65%	12.82%
VTR	60 Neutral	$29.44B	336.28	1.36%	2.61%	10.00%	―
Sector *	60 Neutral	$2.78B	11.39	0.16%	8531.54%	5.92%	-14.67%
HR	54 Neutral	$5.58B	―	-10.95%	7.80%	-5.62%	-140.10%

* Real Estate Sector Average

Performance Comparison

VTR

Ventas

66.56

21.18

46.67%

DOC

Healthpeak Properties

17.81

-0.26

-1.44%

WELL

Welltower

150.72

56.93

60.70%

OHI

Omega Healthcare

37.02

7.26

24.40%

Healthcare Realty Trust

15.21

1.39

10.06%

CTRE

CareTrust REIT

28.54

4.64

19.41%

Ventas Earnings Call Summary

Earnings Call Date:Apr 30, 2025

(Q1-2025)

% Change Since: -5.02%|

Next Earnings Date:Jul 31, 2025

Earnings Call Sentiment Positive

The earnings call highlights Ventas's strong first-quarter performance, driven by significant growth in their senior housing segment and increased investment activities. While the company faces some challenges, such as seasonal move-outs and research segment performance, the overall outlook remains positive due to favorable demographic trends and strategic portfolio management.

Q1-2025 Updates

Positive Updates

Strong First Quarter Financial Performance

Ventas delivered $0.84 of normalized FFO per share in the first quarter, an increase of approximately 8% year-over-year, driven by their senior housing operating portfolio.

Significant Growth in Senior Housing Segment

SHOP's 14% year-over-year cash same store NOI growth was driven by meaningful increases in occupancy and rate. The U.S. SHOP portfolio showed occupancy growth of 330 basis points and NOI growth of 16%.

Increased Investment Activity

Ventas increased their full-year investment guidance to $1.5 billion from their original $1 billion, having closed $900 million in senior housing investments year-to-date.

Favorable Demographic Trends

The over-80 population is projected to increase significantly, creating strong demand for senior housing. The current supply constraints, with new senior housing units at the lowest on record, present a favorable environment for Ventas.

Enhanced Portfolio Composition

Ventas has transitioned 45 Brookdale communities to SHOP and introduced new operators, with expectations to double the NOI from approximately $50 million to over $100 million.

Negative Updates

Seasonal and Clinical Move-Outs Impact

The company experienced elevated clinical move-outs in March, causing the starting occupancy point for the second quarter to be lower than expected.

Research Segment Challenges

The research portfolio experienced a $200,000 reduction in NOI due to lower occupancy, with ongoing macroeconomic uncertainties contributing to the challenges.

Company Guidance

In the Ventas First Quarter 2025 Earnings Call, the company provided guidance for strong financial performance driven by their senior housing operating portfolio (SHOP), which saw a 14% year-over-year cash same-store NOI growth. This growth was fueled by significant increases in occupancy and rates, with SHOP delivering $0.84 of normalized FFO per share in the first quarter, marking an 8% increase. The company projected a 7% normalized FFO per share growth for the full year 2025. Ventas also highlighted a 7.4% revenue growth within SHOP, supported by a 290 basis point increase in same-store SHOP occupancy. The company's investment activity is set to expand, with a raised full-year investment guidance from $1 billion to $1.5 billion in senior housing communities, expected to offer 7% to 8% year-one NOI yields and low-to-mid teens unlevered IRRs. The call reaffirmed a robust financial profile with a 3% dividend yield and improved leverage and liquidity, positioning Ventas favorably in the REIT space.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.