Brookdale Senior Living just announced that May’s occupancy levels jumped quite impressively. Nothing like a proxy challenge to get things moving in the right direction. If only they had worked it two to three years ago, Cindy Baier might still have her job. But heck, she still has a lot of equity in the company, which is now increasing in value. Finally.
May’s month-end occupancy increased by 50 basis points over April’s to land at 81.5%, or 200 basis points higher than last May. The weighted average occupancy in May was 80.0%, or 190 basis points above last May’s. Same-community weighted average occupancy in May jumped to 80.6%, up 20 basis points sequentially, while month-end same-community occupancy in May rose to 82.1%, up 50 basis points sequentially.
This is all great news, but it may be too little, too late for the Board. The proxy votes are already being sent in, but it is too early to know how the voting went. For investors who are undecided and have not yet voted, this blip in census may convince them to give management another chance, or maybe just wait to see who the next CEO will be. What a shame this was not happening a year ago, or two years ago. Even though half the Board has been replaced in the past year, we still like the candidates that Ortelius Advisors has nominated. And we still think Beth Mace was a good choice, if she gets vocal with her opinions.
The news about May’s occupancy gains sent Brookdale’s share price up by over 9% the day after the announcement, reaching $7.29 per share and closing at $7.11. While this is certainly welcome, shareholders want to see a much higher price. It will get higher, but perhaps not as high as they think it can go.
