We are at the end of the first quarter 2025 earning roll call, and Sonida Senior Living posted another solid quarter. Weighted average occupancy for its same-community portfolio (56 communities) increased by 100 basis points year over year to 86.8%, which is at the top end of many of its competitors. In addition, same-community RevPOR increased by 5.5% to $4,274 year over year, same-community net operating income increased by 19.3% to $16.1 million, and the same-community operating margin jumped by 280 basis points to 27.6%.
On a sequential basis, RevPOR increased by 1.8%, same-community net operating income increased by 4.5%, and same-community net operating margin jumped by 80 basis points. All of this in the traditionally bad winter months for the industry. Maybe, just maybe, during this recovery the industry has learned how to better combat the flu season and anything else that is thrown its way.
While Sonida is still losing money on a GAAP basis, operating cash flow is positive, and they acquired 16 additional communities in 2024. For several years now, management has delivered on what it has said it would do, but the company remains relatively small to be publicly traded with a market cap of about $465 million. The share price jumped by nearly 12% in early trading, so investors liked what they heard about future growth and cash flow.
Now, here is a bit of speculation. Since the management team appears to be doing quite well, against the odds, maybe they should be brought into Brookdale Senior Living with a reverse merger and apply their talents on the big stage. After all, Sonida’s controlling shareholder also owns 2% of Brookdale and tried to launch a proxy fight. The Brookdale Board is looking for talent, so why not? Shhhh. You did not hear it here.
