This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Health Care REITs, an Attractive Pipeline for Dividends

Stocks in this article: VTR HTA OHI MPW

Several health care REITs that I recommend include Ventas (VTR - Get Report) , Healthcare Trust of AmericA (HTA - Get Report), Omega Healthcare Investors (OHI - Get Report) and Medical Properties Trust (MPW - Get Report). Each of these REITs is differentiated by sector and they all provide unique operating fundamentals.

Starting with Medical Properties Trust, based in Birmingham, Ala. In a CNBC "Mad Money" interview with Jim Cramer, MPT Chairman Edward Aldag, Jr., explains his company's differentiated health care model:

"There are a lot of hospitals... the market is huge out there. There's about a half a trillion dollars of available hospital properties out there... the pipeline is huge and we think that 2013 will be another big growth year for us."

Hospitals are the focal point of the health care delivery system and that produces a more stable and predictable value proposition. As Edward Aldag, Jr. explained (on "Mad Money"):

"If you look at the history of this country we have a lot of presidents... it doesn't matter who the president is going to be. Hospitals are going to be there. Hospitals are at the top of the pyramid in the delivery system for this sector. We're going to have hospitals regardless of whether it's Romney or whether it's Obama. So we're in a very good position throughout the election and beyond."

Medical Properties Trust pays an attractive dividend yield of 7.05% -- the second highest dividend yield in the health care sector and also one of the highest dividend yields in the equity REIT sector.

Since 2004, MPT's dividend has been paid every quarter and the dividend has increased by 18.2% compounded annually since 2004. In addition, since the company's IPO, MPT has returned 53.5% (compared with the MSCI U.S. REIT Index of 42.2%) and the three-year return (to 2011) was 90% (compared with 73.9% for the MSCI U.S. REIT Index).

Omega Healthcare is the "big dog" of the health care dividend dynasty. The Maryland-based REIT has a market cap of $2.48 billion and its current dividend yield is 7.95%. As of the third quarter, the company owned or held mortgages on 460 skilled nursing facilities, distributed among 47 third-party operators, in 33 states.

2 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,416.85 +225.48 1.31%
S&P 500 2,021.25 +19.09 0.95%
NASDAQ 4,683.4070 +45.4130 0.98%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs