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Welltower (WELL)
NYSE:WELL
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Welltower
(NYSE:WELL)78Outperform
Positive Factors
Earnings
Welltower reported a beat in FFO, which was above expectations, driven by strong performance in their senior housing operating portfolio.
New Business Development
The company introduced a new fund management business aimed at driving significant revenue generation opportunities.
Strategic Expansion
WELL continues to execute on external growth with significant acquisitions, indicating a strong strategy for expansion.
Negative Factors
Welltower (WELL) vs. S&P 500 (SPY)
Market Cap
$98.70B
Dividend Yield1.67%
Average Volume (3M)2.87M
Price to Earnings (P/E)186.7
Beta (1Y)0.67
Revenue Growth20.40%
EPS Growth57.80%
CountryUS
Employees533
SectorReal Estate
Sector Strength72
IndustryREITs
Share Statistics
EPS (TTM)0.82
Shares Outstanding641,308,040
10 Day Avg. Volume3,103,614
30 Day Avg. Volume2,874,626
Financial Highlights & Ratios
PEG Ratio3.23
Price to Book (P/B)N/A
Price to Sales (P/S)12.59
Price to Cash Flow (P/CF)45.00
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$166.50Price Target Upside8.19% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering12
Welltower Business Overview & Revenue Model
Company DescriptionWelltower Inc. (NYSE: WELL) is a leading real estate investment trust (REIT) specializing in the ownership, management, and development of healthcare infrastructure. The company primarily focuses on senior housing, post-acute care, and outpatient medical facilities, operating across the United States, Canada, and the United Kingdom. Welltower partners with top healthcare providers to create environments that enhance health outcomes and improve the quality of life for patients and residents.
How the Company Makes MoneyWelltower makes money primarily through the acquisition, ownership, and management of healthcare real estate properties. Its revenue streams include rental income from leasing properties to healthcare operators and facilities, as well as potential capital gains from the sale of properties. The company often enters long-term lease agreements with healthcare systems and operators, which provides a stable and predictable cash flow. Welltower's strategic partnerships with leading healthcare providers and its focus on high-demand sectors such as senior housing and medical office buildings contribute significantly to its earnings. Additionally, Welltower may earn revenue through property development and redevelopment projects, enhancing the value of its portfolio over time.
Welltower Financial Statement Overview
Summary
Welltower has demonstrated strong revenue growth and profitability, with a stable balance sheet and robust cash flow generation. Financial stability has improved, though there's potential to enhance shareholder returns and optimize investment strategies.Income Statement
Welltower has demonstrated strong revenue growth with a positive trajectory from 2019 to 2024. The gross profit margin is robust and consistent, indicating efficient management of operational costs. The net profit margin has improved, reflecting enhanced profitability, though there was a dip in EBIT over the years. Overall, the company's revenue growth and profitability are commendable.85
Very Positive
Balance Sheet
The balance sheet shows a healthy equity position with an increasing equity ratio, signifying financial stability and low leverage. The debt-to-equity ratio has improved due to a reduction in total debt, enhancing the company's financial flexibility. However, the return on equity is moderate, suggesting room for improvement in generating returns for shareholders.72
Positive
Cash Flow
The cash flow statement highlights solid operating cash flow generation, which supports the company's capital expenditures and dividends. Free cash flow has grown over the years, reflecting efficient cash management. The operating cash flow to net income ratio is robust, indicating efficient conversion of earnings to cash. Despite some fluctuations in investing cash flow, the overall cash flow position is strong.78
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 7.85B | 6.63B | 5.86B | 4.74B | 4.61B | Gross Profit |
| 3.02B | 2.68B | 2.30B | 1.97B | 2.01B | EBIT |
| 972.86M | 1.12B | 729.10M | 754.25M | 676.54M | EBITDA |
| 2.73B | 2.40B | 2.01B | 1.70B | 1.52B | Net Income Common Stockholders |
| 527.14M | 340.09M | 141.21M | 162.04M | -41.52M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 3.51B | 1.99B | 631.68M | 269.26M | 1.55B | Total Assets |
| 51.04B | 44.01B | 37.89B | 34.91B | 32.48B | Total Debt |
| 2.34B | 16.12B | 14.96B | 14.68B | 14.22B | Net Debt |
| -1.17B | 14.13B | 14.33B | 14.41B | 12.67B | Total Liabilities |
| 18.47B | 17.64B | 16.50B | 15.91B | 15.26B | Stockholders Equity |
| 31.96B | 25.40B | 20.29B | 17.64B | 15.97B |
| Cash Flow | Free Cash Flow | |||
| 2.26B | 1.55B | 1.30B | 1.26B | 1.35B | Operating Cash Flow |
| 2.26B | 1.60B | 1.33B | 1.28B | 1.36B | Investing Cash Flow |
| -5.51B | -5.71B | -3.70B | -4.52B | 2.35B | Financing Cash Flow |
| 4.91B | 5.45B | 2.76B | 1.57B | -2.08B |
Welltower Technical Analysis
Positive
153.90
Price Trends
136.33
Positive
134.12
Positive
122.75
Positive
Market Momentum
4.97
Negative
67.54
Neutral
83.24
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WELL, the sentiment is Positive. The current price of 153.9 is above the 20-day moving average (MA) of 147.98, above the 50-day MA of 136.33, and above the 200-day MA of 122.75, indicating a bullish trend. The MACD of 4.97 indicates Negative momentum. The RSI at 67.54 is Neutral, neither overbought nor oversold. The STOCH value of 83.24 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WELL.
Welltower Risk Analysis
Welltower disclosed 45 risk factors in its most recent earnings report. Welltower reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Welltower Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $98.70B | 186.70 | 1.65% | 1.67% | 20.40% | 57.80% | |
76 Outperform | $10.38B | 24.52 | 8.96% | 7.27% | 9.90% | 56.41% | |
73 Outperform | $14.60B | 57.09 | 2.89% | 5.91% | 23.82% | -37.59% | |
72 Outperform | $1.59B | 17.08 | 9.48% | 6.37% | 6.54% | -4.13% | |
63 Neutral | $31.32B | 358.18 | 0.75% | 2.56% | 9.48% | ― | |
61 Neutral | $4.91B | 18.99 | -3.12% | 7.77% | 6.71% | -19.69% |
* Real Estate Sector Average
Performance Comparison
WELL
Welltower
153.90
64.28
71.73%
DOC
Healthpeak Properties
20.25
4.19
26.09%
LTC
LTC Properties
35.69
5.97
20.09%
OHI
Omega Healthcare
37.38
8.68
30.24%
VTR
Ventas
69.81
28.27
68.05%
Welltower Earnings Call Summary
Earnings Call Date: Feb 11, 2025 | % Change Since: 7.80% | Next Earnings Date: May 5, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong positive outlook for Welltower with record growth in their senior housing operating portfolio and significant acquisition activity. Challenges are noted in the U.S. commercial real estate debt market and higher expenses in the U.K., but these are offset by the company's operational improvements and financial performance.Highlights
Record Growth in Senior Housing Operating Portfolio
The senior housing operating portfolio achieved nearly 24% same-store NOI growth, marking the ninth consecutive quarter of net operating income growth exceeding 20%. Sequential occupancy growth was 120 basis points, defying typical seasonal trends.
Strong Financial Performance
Welltower reported a 17.7% year-over-year growth in normalized funds from operations, with a 23% revenue growth, 26% EBITDA growth, and nearly 20% FFO per share growth for the full year 2024.
Significant Acquisition Activity
Closed $2.2 billion of transactions in Q4 2024, with a robust pipeline of $2 billion of acquisitions already under contract in 2025, demonstrating strong market position and efficient deal-making capabilities.
Operational Improvements and Margin Expansion
Achieved a 460 basis points spread between RevPAR and unit expense, the highest in recorded history, resulting in a 320 basis points expansion in operating margins for the senior housing portfolio.
Enhanced Balance Sheet and Liquidity
Net debt to adjusted EBITDA reduced to 3.5 times, with $9 billion of liquidity available, and a strong balance sheet allowing for first calls from market participants.
Lowlights
Challenges in U.S. Commercial Real Estate Debt Market
The U.S. commercial real estate debt market faces significant headwinds with substantial maturities in 2025, totaling $1 trillion, and regional banks experiencing high loan modifications and stock performance challenges.
Higher Operating Expenses in U.K. Market
Increased employment taxes and minimum wage in the U.K. are causing higher operating expense growth compared to the U.S., although it is partially offset by strong top-line growth.
Company Guidance
During the Welltower Fourth Quarter 2024 Earnings Conference Call, the company provided optimistic guidance for 2025, highlighting several key metrics and achievements. The company reported a strong 18% year-over-year increase in normalized FFO per share, driven by its senior housing operating portfolio, which saw a 24% same-store NOI growth. Notably, Welltower achieved a 23% revenue growth and a 26% EBITDA growth for the full year of 2024. The SHARP portfolio reported a sequential same-store occupancy growth of 120 basis points in Q4 and 310 basis points year over year, marking a significant milestone as occupancy grew during the typically slow holiday season. Looking ahead, Welltower expects further occupancy growth in 2025, driven by favorable market conditions and strategic capital deployment. The company completed $2.2 billion in transactions during the fourth quarter and anticipates robust investment activity, with $2 billion already under contract in early 2025. Additionally, Welltower noted ongoing improvements in operating margins, achieving a 320 basis point expansion, and expects further enhancements supported by its operating platform build-out.Welltower Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Welltower Announces Executive Promotions and Leadership Changes
Positive
Jan 2, 2025
Welltower Inc. announced several executive promotions, highlighting its commitment to long-term growth and internal talent development. The appointments of Nikhil Chaudhri and Tim McHugh as Co-Presidents, along with other leadership changes, are expected to bolster Welltower’s operational capabilities and enhance its positioning within the healthcare real estate sector, aligning with its strategic goals for future expansion and success.
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.