Chicago-based Ventas, Inc. (VTR) is a leading real estate investment trust focused on delivering strong, sustainable shareholder returns by enabling exceptional environments that benefit a large and growing aging population. With a market cap of $27 billion, Ventas operates numerous senior housing communities, providing valuable services to residents.
The real estate major has substantially outperformed the broader market over the past year. VTR stock prices have surged 29.4% on a YTD basis and 51.5% over the past year outpacing the S&P 500 Index’s ($SPX) 25.5% gains in 2024 and 35.5% returns over the past year.
Narrowing the focus, Ventas has also outperformed the SPDR Dow Jones REIT ETF’s (RWR) 9.4% gains on a YTD basis and 27.1% returns over the past year.
Shares of Ventas declined 1.5% in the trading session after the release of its Q3 earnings on Oct. 30. Although the company reported a robust 7.5% year-over-year growth in total revenues, reaching $1.2 billion, its rental income dropped 2.5% compared to the year-ago quarter to $376.3 million. However, Ventas' overall performance has remained impressive. The company has showcased strong execution and closed on $1.4 billion of senior housing investments, with an additional $300 million investments under contract, underscoring its ability to capture value-creating opportunities in senior housing, and to meaningfully expand its participation in the multiyear senior housing growth opportunity.
Ventas reported a 6.7% year-over-year growth in normalized funds from operations (FFO) to $0.80, matching analysts’ estimates. Moreover, observing the strong momentum Ventas improved its full-year earnings and FFO growth guidance.
For the current fiscal, ending in December, analysts expect Ventas to report a 6% year-over-year growth in normalized FFO to $3.17. Moreover, Ventas has a robust earnings surprise history. It surpassed or matched analysts’ FFO forecasts in each of the past four quarters.
VTR stock has a consensus “Moderate Buy” rating overall. Out of the 19 analysts covering the stock, 12 recommend “Strong Buy,” two advise “Moderate Buy,” and five suggest a “Hold” rating.
This configuration is slightly more bullish than two months ago, when 11 analysts recommended “Strong Buy” ratings.
On Oct. 11, Scotiabank analyst Nicholas Yulico maintained a “Hold” rating while raising the price target to $65.
VTR’s mean price target of $67.83 represents a premium of 5.2% to current price levels. Meanwhile, the Street-high target of $76 suggests a potential upside of 17.9%.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
