Comparing National Health Investors (NHI) and Physicians Realty Trust (DOC)

Physicians Realty Trust (NYSE: DOC) and National Health Investors (NYSE:NHI) are both mid-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, dividends, analyst recommendations, valuation and risk.

Insider and Institutional Ownership

82.3% of Physicians Realty Trust shares are held by institutional investors. Comparatively, 69.1% of National Health Investors shares are held by institutional investors. 0.5% of Physicians Realty Trust shares are held by company insiders. Comparatively, 5.2% of National Health Investors shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Physicians Realty Trust and National Health Investors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Physicians Realty Trust 11.51% 1.75% 1.10%
National Health Investors 59.24% 12.56% 6.38%

Dividends

Physicians Realty Trust pays an annual dividend of $0.92 per share and has a dividend yield of 5.1%. National Health Investors pays an annual dividend of $3.80 per share and has a dividend yield of 4.8%. Physicians Realty Trust pays out 400.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. National Health Investors pays out 97.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. National Health Investors has raised its dividend for 7 consecutive years.

Earnings & Valuation

This table compares Physicians Realty Trust and National Health Investors’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Physicians Realty Trust $296.22 million 9.54 $195.49 million $0.23 78.00
National Health Investors $263.75 million 12.22 $257.02 million $3.89 20.21

National Health Investors has higher revenue, but lower earnings than Physicians Realty Trust. National Health Investors is trading at a lower price-to-earnings ratio than Physicians Realty Trust, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations and price targets for Physicians Realty Trust and National Health Investors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Physicians Realty Trust 1 2 10 0 2.69
National Health Investors 1 3 2 0 2.17

Physicians Realty Trust currently has a consensus target price of $20.55, indicating a potential upside of 14.52%. National Health Investors has a consensus target price of $79.25, indicating a potential upside of 0.79%. Given Physicians Realty Trust’s stronger consensus rating and higher possible upside, analysts clearly believe Physicians Realty Trust is more favorable than National Health Investors.

Risk & Volatility

Physicians Realty Trust has a beta of 0.55, indicating that its share price is 45% less volatile than the S&P 500. Comparatively, National Health Investors has a beta of 0.56, indicating that its share price is 44% less volatile than the S&P 500.

Summary

National Health Investors beats Physicians Realty Trust on 10 of the 17 factors compared between the two stocks.

About Physicians Realty Trust

Physicians Realty Trust (the Trust) is a real estate investment trust. Physicians Realty L.P. is the operating partnership of the Trust. The Trust and its operating partnership are engaged in acquiring, developing, owning and managing healthcare properties that are leased to physicians, hospitals and healthcare delivery systems. As of December 31, 2016, the Company’s portfolio consisted of 246 properties located in 29 states with approximately 10,883,601 net leasable square feet. The Company invests in real estate that is integral to providing healthcare services. The Company focuses its investment activity on various types of healthcare properties, such as medical office buildings; outpatient treatment and diagnostic facilities; physician group practice clinics; ambulatory surgery centers, and specialty hospitals and treatment centers. Its properties include Arrowhead Commons, Aurora Medical Office Building, Decatur Medical Office Building and El Paso Medical Office Building.

About National Health Investors

National Health Investors, Inc. is a self-managed real estate investment trust (REIT) specializing in sale-leaseback, joint-venture, mortgage and mezzanine financing of need-driven and discretionary senior housing and medical investments. The Company is engaged in the business of owning and financing healthcare properties. Its portfolio consists of lease, mortgage and other note investments in independent living facilities, assisted living facilities, entrance-fee communities, senior living campuses, skilled nursing facilities, specialty hospitals and medical office buildings. Its other investments include marketable securities and a joint venture structured to comply with the provisions of the REIT Investment Diversification Empowerment Act of 2007 (RIDEA) through which it invests in facility operations managed by an independent third party. As of December 31, 2016, it had investments in real estate, mortgage and other notes receivable involving 205 facilities located in 32 states.

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