It has been about a month since the last earnings report for Ventas, Inc. VTR. Shares have lost about 2.4% in that time frame.
Will the recent negative trend continue leading up to its next earnings release, or is VTR due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Ventas' Q4 FFO in Line With Estimates, Revenues Beat
Ventas reported fourth-quarter 2017 normalized FFO of $1.03 per share, in line with the Zacks Consensus Estimate. The figure also matched the year-ago quarter tally.
Results reflect improved property performance and accretive investments.
The bottom line for full-year 2017 came in at $4.16 per share, surpassing the Zacks Consensus Estimate by a penny. Further, the figure came in above the full-year 2016 FFO of $4.13 per share.
The company posted revenues of $895.3 million in the fourth quarter, comfortably beating the Zacks Consensus Estimate of $878.6 million. Further, it compared favorably with the year-ago tally of $875.7 million.
For full-year 2017, revenues came in at $3.57 billion, up from the 2016 tally of $3.44 billion. Moreover, it surpassed the Zacks Consensus Estimate of $3.53 billion.
For the fourth quarter, same-store cash net operating income (NOI) growth for total portfolio (1,068 assets) climbed 2% year over year. Segment wise, same-store cash NOI for the triple-net-leased portfolio grew 4.2%, seniors housing operating portfolio dipped 0.1% and medical office building portfolio rose 1.5%.
Quarter in Detail
During the year, Ventas funded investments, development and redevelopment projects of around $1.8 billion.
Furthermore, the company disposed properties and obtained final repayments on loans receivable for proceeds of more than $900 million. This helped in realizing gains of $700 million for the company.
At present, the company enjoys liquidity with $2.7 billion of available borrowing capacity and $100 million of cash on hand.
Ventas expects 2018 normalized FFO per share outlook in the range of $3.95-$4.05.
The company anticipates same-store cash NOI growth of 0.5-2.0% in 2018.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimate. There has been one revision higher for the current quarter compared to three lower.
Ventas, Inc. Price and Consensus
At this time, VTR has a subpar Growth Score of D, however its Momentum is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for momentum investors than value investors.
Estimates have been broadly trending downward for the stock and the magnitude of these revisions indicates a downward shift. It's no surprise VTR has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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