Several health care REITs that I recommend include
(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"
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.
(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.
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