Financial Analysis: Global Medical REIT (GMRE) & National Health Investors (NHI)
Global Medical REIT (NYSE: GMRE) and National Health Investors (NYSE:NHI) are both financials companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, risk, valuation, institutional ownership, earnings, analyst recommendations and profitability.
Global Medical REIT pays an annual dividend of $0.80 per share and has a dividend yield of 9.6%. National Health Investors pays an annual dividend of $3.80 per share and has a dividend yield of 4.8%. Global Medical REIT pays out -400.0% of its earnings in the form of a dividend. National Health Investors pays out 95.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Global Medical REIT has increased its dividend for 7 consecutive years. Global Medical REIT is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares Global Medical REIT and National Health Investors’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Global Medical REIT||$8.21 million||22.00||-$6.35 million||($0.20)||-41.75|
|National Health Investors||$248.50 million||13.33||$151.54 million||$4.00||19.94|
National Health Investors has higher revenue and earnings than Global Medical REIT. Global Medical REIT is trading at a lower price-to-earnings ratio than National Health Investors, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and recommmendations for Global Medical REIT and National Health Investors, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Global Medical REIT||0||1||5||0||2.83|
|National Health Investors||1||6||1||0||2.00|
Global Medical REIT presently has a consensus target price of $10.75, indicating a potential upside of 28.74%. National Health Investors has a consensus target price of $79.17, indicating a potential downside of 0.74%. Given Global Medical REIT’s stronger consensus rating and higher probable upside, equities analysts clearly believe Global Medical REIT is more favorable than National Health Investors.
Institutional & Insider Ownership
41.0% of Global Medical REIT shares are owned by institutional investors. Comparatively, 70.5% of National Health Investors shares are owned by institutional investors. 16.5% of Global Medical REIT shares are owned by company insiders. Comparatively, 5.2% of National Health Investors shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Volatility & Risk
Global Medical REIT has a beta of -48.01, meaning that its stock price is 4,901% less volatile than the S&P 500. Comparatively, National Health Investors has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500.
This table compares Global Medical REIT and National Health Investors’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Global Medical REIT||-19.98%||-2.86%||-1.39%|
|National Health Investors||59.70%||12.74%||6.54%|
Global Medical REIT beats National Health Investors on 9 of the 17 factors compared between the two stocks.
About Global Medical REIT
Global Medical REIT Inc. is engaged primarily in the acquisition of licensed, purpose-built healthcare facilities and the leasing of these facilities to clinical operators with market share. The Company’s strategy is to produce increasing, reliable rental revenue by expanding its portfolio, and leasing its healthcare facilities to market operators under long-term triple-net leases.
About National Health Investors
National Health Investors, Inc. is a self-managed real estate investment trust (REIT) specializing in sale-leaseback, joint-venture, mortgage and mezzanine financing of need-driven and discretionary senior housing and medical investments. The Company is engaged in the business of owning and financing healthcare properties. Its portfolio consists of lease, mortgage and other note investments in independent living facilities, assisted living facilities, entrance-fee communities, senior living campuses, skilled nursing facilities, specialty hospitals and medical office buildings. Its other investments include marketable securities and a joint venture structured to comply with the provisions of the REIT Investment Diversification Empowerment Act of 2007 (RIDEA) through which it invests in facility operations managed by an independent third party. As of December 31, 2016, it had investments in real estate, mortgage and other notes receivable involving 205 facilities located in 32 states.
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