Health Care REIT Inc. Earnings Cheat Sheet: FFO Rises

S&P 500 (NYSE:SPY) component Health Care REIT Inc. (NYSE:HCN) reported higher profit for the third quarter as revenue showed growth. Health Care REIT is a real estate investment trust that invests in and manages senior housing and health care real estate.

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Health Care REIT Earnings Cheat Sheet for the Third Quarter

Results: Reported normalized Funds from Operations (FFO) of $139.7 million (89 cents per share) vs. $99.4 million or 79 cents a share a year earlier. FFO a measure of performance of a real estate investment trust (REIT), removes the profit-reducing effect that depreciation has on earnings.

Revenue: Gross revenue rose more than twofold to $384.8 million from the year earlier quarter.

Actual vs. Wall St. Expectations: HCN beat the mean analyst estimate of 88 cents per share. It beat the average revenue estimate of $376.4 million.

Quoting Management: “Health Care REIT’s relationship investing strategy continues to generate significant opportunities, as demonstrated by nearly $650 million of investments completed during the third quarter of 2011. These high-quality investments are concentrated in private-pay seniors housing assets, such as our new investment with Chelsea Senior Living, as well as health system affiliated medical office buildings,” said George L. Chapman, Chairman, Chief Executive Officer and President of Health Care REIT. “We continue to enhance the overall quality of our portfolio while generating strong financial results, as evidenced by our 13% FFO per share growth and 7% FAD per share growth during the third quarter. As previously announced, we have increased our 2012 dividend rate 4% above our 2011 payments, a result of the strength of our existing portfolio, future pipeline and earnings growth potential.”

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 91 cents a share to 90 cents over the last ninety days. The average estimate for the fiscal year is $3.39 per share, a rise from $3.37 ninety days ago.

Competitors to Watch: HCP, Inc. (NYSE:HCP), Ventas, Inc. (NYSE:VTR), Omega Healthcare Investors, Inc. (NYSE:OHI), National Health Investors Inc (NYSE:NHI), LTC Properties, Inc. (NYSE:LTC), Senior Housing Properties Trust (NYSE:SNH), Healthcare Realty Trust Inc. (NYSE:HR), Universal Health Realty Income Trust (NYSE:UHT), Medical Properties Trust, Inc. (NYSE:MPW), and Nationwide Health Properties Inc. (NYSE:NHP).

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(Source: Xignite Financials)