In their first-quarter earnings report Wednesday, Healthcare Realty Trust executives said they had spent $21.3 million on acquisitions. The Nashville-based real estate investment trust has since recouped that money and then some by selling some of its properties in Florida.
Healthcare Realty last month sold to Texas-based MedProperties and AW Property out of Palm Beach medical office buildings in the Tampa area as well as farther south in Venice, Bonita Springs and Fort Myers. Combined, the buildings have almost 240,000 square feet.
Separately, the company also sold to AW and New York-based HRE Capital a 34,500-square-foot MOB in Lehigh Acres. In all, the sales put $33.3 million in Healthcare Realty’s bank account, but the company — which owns another dozen or so properties in Florida — said in its quarterly filing with the Securities and Exchange Commission that it expects to book a small impairment charge on the deal.
RBC Capital Markets analysts have lifted their price target for Healthcare Realty Trust shares to $23 from $20 while reiterating their 'outperform' rating. The move doesn't amount to a whole lot for investors to cheer, though: Shares of Healthcare Realty (Ticker: HR) are flat in Wednesday trading at around $22.70. They've risen more than 20 percent in the past three months.
Analyst David Aubuchon at Robert W. Baird has lowered his rating on shares of Healthcare Realty, which have run up almost 30 percent since Thanksgiving. Aubuchon now has the Nashville-based real estate investment trust rated 'neutral' instead of 'outperform,' but is keeping his $22 target. At about noon on Monday, the stock (Ticker: HR) was changing hands at $20.96.
BMO Capital Markets analyst Richard Anderson sees brighter days ahead for Healthcare Realty Trust shareholders. He has raised his rating on shares of the Nashville-based real estate investment trust to 'outperform' from 'market perform.' He also has lifted his price target for the stock (Ticker: HR) to $21 from $17.
Wunderlich Securities researcher Kevin Reynolds, meanwhile, has gone in the opposite direction when it comes to shares of Pinnacle Financial Partners. He has downgraded the stock (Ticker: PNFP) to 'hold' from 'buy' but has kept his price target at $17.
In a quick investor update, Healthcare Realty Trust says it did not sell any shares in August under an at-the-market partnership with brokerage firms Cantor Fitzgerald and Credit Agricole. The medical office REIT had been very active in the market earlier this year but the market turmoil last month — which took its shares (Ticker: HR) from $20 to below $16 in a dozen trading days — cooled its heels a bit.
Guggenheim Securities retail analyst John Heinbockel has some follow-up thoughts on the inflation ripples caused by Dollar General last week. The locally based discounter (Ticker: DG) had said it was for the most part holding off on passing through price hikes on consumable goods, but Heinbockel — who formally follows Kroger in this space — suggests that may prove to be a costly strategy.
[I]t is questionable whether "eating" this inflation will result in increased volumes, given the fragile state of the consumer. Finally, it is even more questionable whether incremental traffic would result in improved discretionary sales. It would appear the safest approach would be to pass through inflation, hope to hold comps steady, attack SG&A more aggressively, and expand EBIT margin via expense leverage.
Heinbockel added he doesn't expect consumable demand to suffer from inflation pressures — he points out that the price of a basket of 125 goods at market leader Wal-Mart is up "only" 3.7 percent this year — but that discretionary purchases will be far more affected.
Over at Avondale Partners, analyst Kemp Dolliver says his thesis on shares of Healthcare Realty has been reinforced by a recent meeting with top executives. The company, he wrote to clients Wednesday, has a low-risk strategy that should push up the shares by some 20 percent to $25. On top of that, its dividend yield of 5.7 percent (Ticker: HR) has it looking more interesting compared to other income-oriented investments.
Community Health Systems' Wyoming Valley Health Care System in Pennsylvania broke ground on Friday on a $3.5 million medical office building and diagnostic center. The 16,000-square-foot facility will house primary care offices, laboratory services and imaging, rehab and urgent care centers in the town of Mountain Top.
The building will be owned by Franklin, Tenn.-based Greystone Brokerage & Development and leased by the health system.
- ALEX B FRUIN INHERITANCE TRUST; CANDACE F STEFANSIC INHERITANCE TRUST; CANDANCE F STEFANSIC INHERITANCE TRUST; FRUIN, ALEX B TRUSTEE; FRUIN ALEX B INHERITANCE TRUST; STEFANSIC, CANDACE F TRUSTEE; STEFANSIC CANDACE F INHERITANCE TRUST; STEFANSIC CANDANCE F INHERITANCE TRUST
- ROSS, BRIDGETT D
- COOKE, ETHEN LANYARD TRUSTEE; COOKE, ETHEN LEWIS ESTATE
- JACOBS, JESSICA ALEXANDRA; JACOBS, ERIKA BESS