Target Healthcare REIT (LON:THRL) Releases Earnings Results

Target Healthcare REIT (LON:THRL) released its quarterly earnings data on Wednesday. The company reported GBX 3.38 EPS for the quarter, Digital Look Earnings reports. Target Healthcare REIT had a net margin of 83.43% and a return on equity of 8.61%.

Here are the key takeaways from Target Healthcare REIT’s conference call:

• Strong financial recovery: EPRA EPS rose 8.5% to £0.034 (adjusted EPS +3% excluding one-off arrears), EPRA NTA increased 4% to £1.194, dividend cover is 113% (107% ex-arrears) and the six-month total accounting return was 6.8%.
• High-quality, inflation-linked portfolio: 86 homes (~£900m portfolio) with annualized contracted rent of £59.5m, 100% ensuite wet rooms and EPC A/B ratings, and rental income fully linked to inflation.
• Active capital recycling and growth runway: Management disposed of 10 homes at a premium, redeployed part proceeds into three acquisitions and a forward commit (adding c.£2m contracted rent so far), and reports a pipeline of opportunities >6% NIY that exceeds available capital; LTV is ~15% with a target toward 25% as acquisitions proceed.
• Operational metrics improving: Average rent cover is 1.9x (highest since IPO), mature-home occupancy ~85%, £1.9m of historic arrears recovered and management expects to return to 100% rent collection by year-end.
• Ongoing sector risks remain, including periodic tenant/operator issues, staffing and regulatory instability, and a wide spread of valuation yields (5.6%–8.9%) driven by covenant strength and local operational performance.

Target Healthcare REIT Price Performance

LON:THRL opened at GBX 103.40 on Thursday. Target Healthcare REIT has a 1 year low of GBX 83.60 and a 1 year high of GBX 108.80. The stock’s fifty day moving average price is GBX 104.12 and its two-hundred day moving average price is GBX 98.57. The company has a market cap of £641.33 million, a P/E ratio of 10.54, a P/E/G ratio of 1.48 and a beta of 0.68.

About Target Healthcare REIT

Our investment objective is to provide shareholders with an attractive level of income together with the potential for capital and income growth, from a portfolio of UK care homes, diversified by tenant, geography, and resident payment profile. We only invest in modern, purpose-built homes.