Ventas (NYSE: VTR) and CareTrust REIT (NASDAQ:CTRE) are both finance companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, profitabiliy, risk, institutional ownership and earnings.
Risk and Volatility
Ventas has a beta of 0.08, meaning that its share price is 92% less volatile than the S&P 500. Comparatively, CareTrust REIT has a beta of 0.9, meaning that its share price is 10% less volatile than the S&P 500.
Earnings and Valuation
This table compares Ventas and CareTrust REIT’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Ventas||$3.48 billion||7.02||$1.85 billion||$1.97||34.92|
Ventas has higher revenue and earnings than CareTrust REIT. CareTrust REIT is trading at a lower price-to-earnings ratio than Ventas, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
89.1% of Ventas shares are owned by institutional investors. Comparatively, 86.8% of CareTrust REIT shares are owned by institutional investors. 1.3% of Ventas shares are owned by insiders. Comparatively, 1.6% of CareTrust REIT shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
This is a summary of current recommendations and price targets for Ventas and CareTrust REIT, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Ventas currently has a consensus target price of $64.14, suggesting a potential downside of 6.77%. CareTrust REIT has a consensus target price of $17.67, suggesting a potential downside of 3.09%. Given CareTrust REIT’s stronger consensus rating and higher probable upside, analysts plainly believe CareTrust REIT is more favorable than Ventas.
Ventas pays an annual dividend of $3.10 per share and has a dividend yield of 4.5%. CareTrust REIT does not pay a dividend. Ventas pays out 157.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ventas has raised its dividend for 6 consecutive years.
This table compares Ventas and CareTrust REIT’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
CareTrust REIT beats Ventas on 9 of the 15 factors compared between the two stocks.
Ventas, Inc. is a real estate investment trust (REIT) with its properties located throughout the United States, Canada and the United Kingdom. The Company operates through three segments: triple-net leased properties, senior living operations and office operations. Under its triple-net leased properties segment, the Company invests in and owns seniors housing and healthcare properties throughout the United States and the United Kingdom and leases those properties to healthcare operating companies under triple-net or absolute-net leases that obligate the tenants to pay all property-related expenses. In its senior living operations segment, it invests in seniors housing communities throughout the United States and Canada and engages independent operators to manage those communities. In its office operations segment, the Company primarily acquires, owns, develops, leases and manages medical office buildings (MOBs) and life science and innovation centers throughout the United States.
About CareTrust REIT
CareTrust REIT, Inc. is a self-administered, self-managed real estate investment trust. The Company is engaged in the ownership, acquisition and leasing of healthcare-related properties. It makes investments in healthcare-related real estate assets. As of December 31, 2016, its real estate portfolio included 154 skilled nursing facilities (SNFs), SNF Campuses, assisted living facilities and independent living facilities. As of December 31, 2016, the 93 facilities leased to The Ensign Group, Inc. had a total of 9,916 beds and units and are located in Arizona, California, Colorado, Idaho, Iowa, Nebraska, Nevada, Texas, Utah and Washington; the 16 facilities leased to affiliates of Pristine Senior Living, LLC had a total of 1,488 beds and units; and the 42 remaining leased properties had a total of 3,515 beds and units and are located in California, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Maryland, Michigan, Minnesota, North Carolina, Texas, Virginia, Washington and Wisconsin.
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