Welltower (NYSE: HCN) and Universal Health Realty Income Trust (NYSE:UHT) are both financials companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, valuation, profitability, analyst recommendations, earnings and dividends.
Insider & Institutional Ownership
86.2% of Welltower shares are held by institutional investors. Comparatively, 60.3% of Universal Health Realty Income Trust shares are held by institutional investors. 0.2% of Welltower shares are held by insiders. Comparatively, 1.9% of Universal Health Realty Income Trust shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This is a breakdown of current ratings and recommmendations for Welltower and Universal Health Realty Income Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Universal Health Realty Income Trust||0||0||0||0||N/A|
Welltower currently has a consensus target price of $71.83, indicating a potential upside of 28.76%. Given Welltower’s higher probable upside, equities research analysts clearly believe Welltower is more favorable than Universal Health Realty Income Trust.
Valuation and Earnings
This table compares Welltower and Universal Health Realty Income Trust’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Welltower||$4.28 billion||4.83||$1.08 billion||$1.14||48.94|
|Universal Health Realty Income Trust||$67.08 million||12.18||$17.21 million||$3.24||18.36|
Welltower has higher revenue and earnings than Universal Health Realty Income Trust. Universal Health Realty Income Trust is trading at a lower price-to-earnings ratio than Welltower, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Welltower has a beta of 0.17, indicating that its share price is 83% less volatile than the S&P 500. Comparatively, Universal Health Realty Income Trust has a beta of 0.15, indicating that its share price is 85% less volatile than the S&P 500.
This table compares Welltower and Universal Health Realty Income Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Universal Health Realty Income Trust||61.38%||8.12%||3.32%|
Welltower pays an annual dividend of $3.48 per share and has a dividend yield of 6.2%. Universal Health Realty Income Trust pays an annual dividend of $2.66 per share and has a dividend yield of 4.5%. Welltower pays out 305.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Universal Health Realty Income Trust pays out 82.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Welltower has raised its dividend for 32 consecutive years and Universal Health Realty Income Trust has raised its dividend for 8 consecutive years. Welltower is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Welltower beats Universal Health Realty Income Trust on 10 of the 16 factors compared between the two stocks.
Welltower Company Profile
Welltower Inc. invests with seniors housing operators, post-acute providers and health systems to fund real estate and infrastructure. The Company invests in seniors housing and healthcare real estate. It operates in three segments: triple-net, seniors housing operating and outpatient medical. Welltower, a real estate investment trust (REIT), owns interests in properties concentrated in markets in the United States, Canada and the United Kingdom, consisting of seniors housing and post-acute communities, and outpatient medical properties. Its triple-net properties include independent living facilities, independent supportive living facilities (Canada), continuing care retirement communities, assisted living facilities, care homes with and without nursing (the United Kingdom), Alzheimer’s/dementia care facilities, long-term/post-acute care facilities and hospitals. Its outpatient medical properties include outpatient medical buildings.
Universal Health Realty Income Trust Company Profile
Universal Health Realty Income Trust is a real estate investment trust (REIT). The Company invests in healthcare and human service related facilities, including acute care hospitals, rehabilitation hospitals, sub-acute facilities, surgery centers, free-standing emergency departments, childcare centers and medical office buildings (MOBs). As of February 28, 2017, the Company had 67 real estate investments located in 20 states in the United States consisting of six hospital facilities, including three acute care, one rehabilitation and two sub-acute; 54 MOBs; three free-standing emergency departments (FEDs), and four preschool and childcare centers. The Company’s facilities include Southwest Healthcare System, Inland Valley Campus, Wellington Regional Medical Center, Kindred Hospital Chicago Central, Vibra Hospital of Corpus Christi, Chesterbrook Academy, and Desert Valley Medical Center.
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