A Look At National Health Investors (NHI) Valuation After Recent Share Price Strength
Why National Health Investors is on income investors’ radar
National Health Investors (NHI) has drawn attention after recent share price moves, with the stock closing at $78.01 as investors weigh its real estate investment trust model focused on senior housing and medical facilities.
See our latest analysis for National Health Investors.
Recent trading has been relatively firm, with a 2.2% 1 day share price return and a 5.7% 90 day share price return. The 1 year total shareholder return of 21.0% and 3 year total shareholder return of 70.9% point to momentum that has been building rather than fading.
If you are looking beyond healthcare REITs, this could be a convenient moment to broaden your watchlist with fast growing stocks with high insider ownership.
With NHI trading at $78.01, sitting at a reported 54% intrinsic discount and about 10% below one analyst price target, you have to ask: is this a genuine mispricing, or is the market already baking in future growth?
Most Popular Narrative: 9.6% Undervalued
Using a fair value estimate of about $86.25 against the last close at $78.01, the most followed narrative suggests NHI’s current pricing leaves some upside on the table.
NHI's focused expansion of its SHOP (Senior Housing Operating Portfolio) segment, with double-digit NOI growth projected and a robust pipeline of accretive acquisitions, positions the company for outsized multi-year NOI and earnings growth relative to peers.
Curious what kind of revenue growth, margin profile and future earnings multiple have to line up for that valuation gap to make sense? The narrative spells out a detailed path that ties aging demographics, operating performance and cash flows into one cohesive set of numbers.
Result: Fair Value of $86.25 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, that story could easily change if softness in SHOP occupancy persists or if key operators underperform, which could put pressure on rental income and margin expectations.
Find out about the key risks to this National Health Investors narrative.
Build Your Own National Health Investors Narrative
If you want to weigh the same data yourself and come to your own conclusion, you can build a full NHI view in minutes by starting with Do it your way.
A great starting point for your National Health Investors research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.
Looking for more investment ideas?
If you are serious about growing your watchlist, now is the time to widen your search and compare fresh ideas before other investors start paying attention.
- Spot potential bargains early by running through these 885 undervalued stocks based on cash flows that are priced below what their cash flows suggest.
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- Strengthen your income focus by scanning these 12 dividend stocks with yields > 3% that already offer yields above 3%.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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