Diversified Healthcare Trust (NASDAQ:DHC – Get Free Report) and Sabra Healthcare REIT (NASDAQ:SBRA – Get Free Report) are both real estate companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.
Dividends
Diversified Healthcare Trust pays an annual dividend of $0.04 per share and has a dividend yield of 0.5%. Sabra Healthcare REIT pays an annual dividend of $1.20 per share and has a dividend yield of 5.8%. Diversified Healthcare Trust pays out -3.6% of its earnings in the form of a dividend. Sabra Healthcare REIT pays out 461.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Analyst Recommendations
This is a breakdown of recent ratings and target prices for Diversified Healthcare Trust and Sabra Healthcare REIT, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Diversified Healthcare Trust | 1 | 2 | 2 | 1 | 2.50 |
| Sabra Healthcare REIT | 0 | 7 | 7 | 0 | 2.50 |
Volatility & Risk
Diversified Healthcare Trust has a beta of 2.3, suggesting that its stock price is 130% more volatile than the S&P 500. Comparatively, Sabra Healthcare REIT has a beta of 0.64, suggesting that its stock price is 36% less volatile than the S&P 500.
Institutional & Insider Ownership
76.0% of Diversified Healthcare Trust shares are held by institutional investors. Comparatively, 99.4% of Sabra Healthcare REIT shares are held by institutional investors. 10.2% of Diversified Healthcare Trust shares are held by company insiders. Comparatively, 1.1% of Sabra Healthcare REIT shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Profitability
This table compares Diversified Healthcare Trust and Sabra Healthcare REIT’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Diversified Healthcare Trust | -17.73% | -16.22% | -6.06% |
| Sabra Healthcare REIT | 7.61% | 2.34% | 1.18% |
Earnings and Valuation
This table compares Diversified Healthcare Trust and Sabra Healthcare REIT”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Diversified Healthcare Trust | $1.50 billion | 1.30 | -$285.89 million | ($1.11) | -7.27 |
| Sabra Healthcare REIT | $859.56 million | 6.10 | $155.61 million | $0.26 | 78.96 |
Sabra Healthcare REIT has lower revenue, but higher earnings than Diversified Healthcare Trust. Diversified Healthcare Trust is trading at a lower price-to-earnings ratio than Sabra Healthcare REIT, indicating that it is currently the more affordable of the two stocks.
Summary
Sabra Healthcare REIT beats Diversified Healthcare Trust on 10 of the 16 factors compared between the two stocks.
About Diversified Healthcare Trust
Diversified Healthcare Trust is a real estate investment trust, which engages in the ownership of senior living communities, medical office buildings, and wellness centers. It operates through the following segments: Office Portfolio, Senior Housing Operating Portfolio (SHOP), and Non-Segment. The Office Portfolio segment consists of medical office properties leased to medical providers and other medical related businesses, as well as life science properties leased to biotech laboratories and other similar tenants. The SHOP segment manages senior living communities that offers short term and long term residential care, and other services for residents where it pay fees to the operator to manage the communities for its account. The company was founded on December 16, 1998 and is headquartered in Newton, MA.
About Sabra Healthcare REIT
Sabra Health Care REIT, Inc. engages in the business of acquiring, financing, and owning real estate property. The company was founded on May 10, 2010 and is headquartered in Tustin, CA.
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