Now trading at a price of $107.41, Welltower has moved 1.4% so far today.
Welltower returned gains of 29.9% last year, with its stock price reaching a high of $108.06 and a low of $78.38. Over the same period, the stock outperformed the S&P 500 index by 9.1%. More recently, the company's 50-day average price was $103.04. Welltower Inc. (NYSE:WELL), a REIT and S&P 500 company headquartered in Toledo, Ohio, is driving the transformation of health care infrastructure. Based in Toledo, OH, the Large-Cap Real Estate company has 533 full time employees. Welltower has offered a 2.3% dividend yield over the last 12 months.
Increasing Revenues but Narrowing Margins:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $4,700 | $5,121 | $4,606 | $4,742 | $5,861 | $6,638 |
| Operating Margins | 9% | 11% | -1% | 4% | 3% | 5% |
| Net Margins | 18% | 26% | 23% | 8% | 3% | 5% |
| Net Income (M) | $830 | $1,330 | $1,039 | $374 | $161 | $358 |
| Net Interest Expense (M) | $527 | $556 | $514 | $490 | $530 | $608 |
| Depreciation & Amort. (M) | $950 | $1,027 | $1,038 | $1,038 | $1,310 | $1,401 |
| Diluted Shares (M) | 375 | 404 | 417 | 427 | 465 | 519 |
| Earnings Per Share | $2.02 | $3.05 | $2.33 | $0.78 | $0.3 | $0.66 |
| EPS Growth | n/a | 50.99% | -23.61% | -66.52% | -61.54% | 120.0% |
| Avg. Price | $50.66 | $70.88 | $53.9 | $73.79 | $84.27 | $107.41 |
| P/E Ratio | 24.96 | 23.09 | 22.84 | 93.41 | 271.84 | 162.74 |
| Free Cash Flow (M) | $1,318 | $1,207 | $1,120 | $993 | $853 | $1,084 |
| CAPEX (M) | $266 | $329 | $245 | $283 | $476 | $518 |
| EV / EBITDA | 22.42 | 25.81 | 22.79 | 36.78 | 34.9 | 37.94 |
| Total Debt (M) | $12,186 | $13,421 | $2,378 | $13,910 | $14,714 | $15,736 |
| Net Debt / EBITDA | 8.71 | 8.37 | 0.83 | 11.29 | 9.49 | 7.85 |
Welltower has weak operating margins with a negative growth trend, declining EPS growth, and a highly leveraged balance sheet. On the other hand, the company has growing revenues and increasing reinvestment in the business working in its favor. Furthermore, Welltower has positive cash flows.
Welltower's Valuation Is in Line With Its Sector Averages:
Welltower has a trailing twelve month P/E ratio of 119.8, compared to an average of 30.37 for the Real Estate sector. Based on its EPS guidance of $1.74, the company has a forward P/E ratio of 59.2. The -2.1% compound average growth rate of Welltower's historical and projected earnings per share yields a PEG ratio of -56.81. This indicates that its shares are overvalued.Furthermore, Welltower is likely overvalued compared to the book value of its equity, since its P/B ratio of 2.3 is higher than the sector average of 2.09. The company's shares are currently trading 298.3% below their Graham number.
There's an Analyst Consensus of Some Upside Potential for Welltower:
The 17 analysts following Welltower have set target prices ranging from $97.0 to $129.0 per share, for an average of $109.74 with a buy rating. The company is trading -2.1% away from its average target price, indicating that there is an analyst consensus of some upside potential.
Welltower has an average amount of shares sold short because 2.6% of the company's shares are sold short. Institutions own 96.5% of the company's shares, and the insider ownership rate stands at 0.09%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 15% stake in the company is worth $9,579,670,947.
