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Ventas Inc (VTR)
:VTR
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Ventas
(NYSE:VTR)63Neutral
Positive Factors
Financial Performance
Ventas Inc reported a 4Q24 Normalized FFO of $0.81, beating expectations and driven by favorable interest expense.
Strategic Growth
The company closed over $2 billion of investments in the previous year, including $1.9 billion in senior housing with a 7-8% year-one yield.
Negative Factors
Market Expectations
Near-term bears may point to a higher buy-side bar given stock and performance of peers, and therefore results somewhat dissatisfying.
Ventas (VTR) vs. S&P 500 (SPY)
Market Cap
$31.32B
Dividend Yield2.58%
Average Volume (3M)2.80M
Price to Earnings (P/E)358.2
Beta (1Y)0.66
Revenue Growth9.48%
EPS GrowthN/A
CountryUS
Employees498
SectorReal Estate
Sector Strength72
IndustryREITs
Share Statistics
EPS (TTM)0.19
Shares Outstanding437,139,980
10 Day Avg. Volume3,256,219
30 Day Avg. Volume2,796,854
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)6.20
Price to Cash Flow (P/CF)20.40
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
$71.40Price Target Upside1.32% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering10
Ventas Business Overview & Revenue Model
Company DescriptionVentas, Inc. (VTR) is a leading real estate investment trust (REIT) specializing in the ownership and management of properties in the healthcare and senior living sectors. The company invests in a diversified portfolio of real estate assets, including senior housing communities, medical office buildings, life science and innovation centers, hospitals, and other healthcare-related facilities. Ventas leverages its expertise in real estate and healthcare to provide high-quality environments that support the operational needs of its tenants.
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
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.55
Neutral
Balance Sheet
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.70
Positive
Cash Flow
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.45
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| 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
Positive
70.47
Price Trends
61.60
Positive
62.30
Positive
58.67
Positive
Market Momentum
2.54
Negative
75.51
Negative
84.74
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VTR, the sentiment is Positive. The current price of 70.47 is above the 20-day moving average (MA) of 65.60, above the 50-day MA of 61.60, and above the 200-day MA of 58.67, indicating a bullish trend. The MACD of 2.54 indicates Negative momentum. The RSI at 75.51 is Negative, neither overbought nor oversold. The STOCH value of 84.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $98.70B | 186.70 | 3.32% | 1.70% | 20.40% | 57.80% | |
76 Outperform | $10.54B | 24.88 | 8.96% | 7.17% | 9.90% | 56.41% | |
72 Outperform | $1.62B | 17.47 | 9.48% | 6.39% | 6.54% | -4.13% | |
63 Neutral | $31.32B | 358.18 | 0.80% | 2.58% | 9.48% | ― | |
61 Neutral | $4.91B | 18.99 | -3.12% | 7.77% | 6.71% | -19.69% | |
54 Neutral | $11.18B | ― | -3.24% | 5.12% | -4.58% | -1269.23% |
* Real Estate Sector Average
Performance Comparison
VTR
Ventas
70.47
28.48
67.83%
WELL
Welltower
154.85
64.72
71.81%
LTC
LTC Properties
35.93
6.22
20.94%
VTRS
Viatris
9.48
-2.24
-19.11%
OHI
Omega Healthcare
37.55
8.82
30.70%
Ventas Earnings Call Summary
Earnings Call Date: Feb 12, 2025 | % Change Since: 17.57% | Next Earnings Date: May 1, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive outlook for Ventas, with strong performance in senior housing driving significant growth in NOI and FFO per share. Record investments and a dividend increase underscore the company's confidence in its strategy and market position. However, challenges in medical office occupancy and potential NIH funding concerns present some headwinds. Overall, the sentiment leans toward optimism with a focus on strategic growth and financial strength.Highlights
Strong Senior Housing Performance
Shop same-store cash NOI grew nearly 16%, marking the third consecutive year of double-digit growth. Full-year same-store shop occupancy increased by 300 basis points, outperforming market benchmarks.
Record Investment in Senior Housing
Ventas completed over $2 billion in accretive investments focused on senior housing, with $1.4 billion closed in the fourth quarter alone. These investments are expected to yield 7-8% in the first year.
FFO Per Share Exceeds Guidance
Normalized FFO per share for 2024 was $3.19, exceeding the high end of the guidance range. 2025 guidance anticipates further growth with a midpoint of 7% year-over-year increase.
Dividend Increase
Ventas announced a 7% increase in quarterly dividends, reflecting confidence in continued strong performance and cash flow growth.
Improved Leverage and Liquidity
Net debt to EBITDA improved to 6.0 times, entering the long-term target range, with nearly $4 billion in liquidity by the end of 2024.
Lowlights
Medical Office Building Occupancy Challenges
The medical office segment experienced occupancy declines, raising questions about the trajectory and expectation of occupancy gains in 2025.
Potential NIH Funding Concerns
Concerns about potential changes in NIH funding due to policy shifts, although currently halted, could impact the research portfolio.
Rising Interest Expenses
2025 guidance includes an increase in net interest expense by $0.08 per share compared to 2024, due to refinancing maturing debt at higher rates and lower cash balances.
Company Guidance
During the Ventas earnings call, the company provided guidance for 2025, highlighting several key financial metrics and strategic objectives. Ventas anticipates normalized FFO per share growth of 7% at the midpoint, driven by strong performance in their senior housing segment, which is expected to account for over 50% of NOI by year-end. In 2024, the company achieved a full-year normalized FFO per share of $3.19, surpassing their guidance. They reported a nearly 8% total company same-store cash NOI growth, with shop same-store cash NOI increasing by 16%. Ventas also completed $2 billion in senior housing investments, contributing to a significant scale increase to $2.2 billion in annualized EBITDA. Looking ahead, the company plans to continue leveraging its competitive advantages in senior housing, targeting $1 billion in accretive senior housing investments in 2025, while maintaining a focus on enhancing financial strength and flexibility. Additionally, Ventas increased their quarterly dividend by 7%, reflecting confidence in their growth trajectory.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.