Collapse of Brookdale and Capital Senior Living Continues
We are officially in unchartered territory. It is now quite embarrassing that we stated two years ago, as Brookdale Senior Living’s share price dropped below $10, that it had reached a floor. Yes, hindsight is 20/20, but we don’t know anyone who really predicted how drastic it has actually become for senior living stocks. The question is, what to do now? The second question is, will it get worse? The day-to-day volatility in the stock markets is unprecedented. The day-to-day declines in values in our sector are even more unprecedented. It seems that when the major indices drop by 10%, our sector, including the REITs, drops by 20%. It is a magnification of the worries brought on by the... Read More »
Ventas Preparing For Worst
There is no way to mince words. When it comes to valuation, Ventas is a shadow of its former self. After being worth more than $20 billion, its market cap has dropped to just $7.8 billion. This compares with Welltower ($15.8 billion) and Healthpeak Properties ($11.8 billion). So much for the “Big Three” REITs. This is new territory for Ventas and its CEO, Debbie Cafaro. But who knows, maybe the Penguins will win the Stanley Cup this year, if there is one. Ventas, like Brookdale Senior Living, has withdrawn its 2020 earnings guidance. It stated that tours and move-ins at its operators are beginning to slow, even though the first two months of the year met previous expectations. What a... Read More »
Monday’s Massacre
Providers got hurt in Monday’s stock market massacre, but healthcare REITs across the board suffered. We all know that Monday’s massacre in the stock market affected almost all companies. In our sector, the focus has been on providers, since they take care of the highest-risk people as this coronavirus/Covid-19 epidemic spreads. The unprecedented 2,013-point drop in the Dow was bad enough, and providers plunged as well. But so did the healthcare REITs that own their properties. Most of the REITs in our universe dropped by double digits, compared with 7.8% with the Dow and 7.6% with the S&P 500. Diversified Healthcare Trust plunged the most, falling 17.7% on Monday. It was... Read More »
From the Front Lines at NIC
As the hordes descended on San Diego for the Spring NIC conference, we soon learned that hotel rooms suddenly became available at the last minute. Why? Cancelations and no shows, perhaps 10% to 15%, as fears of the coronavirus spread. Larger conferences in the next several weeks have been canceled. For those of us braving the unknown, it was business as usual, elbow bumps instead of handshakes, and no problem finding meeting space in the networking lounge. Obviously, the biggest topic of conversation was the coronavirus, the potential impact on the economy in general, and specifically whether it would be a huge problem for the senior living sector. The worry was that if there were more... Read More »
Seniors Housing Stocks Crash
You can blame the overall plunge in the stock market, but seniors housing stocks crashed disproportionately more than the market as a whole. Capital Senior Living ended Thursday down 22% for the day at just $1.87 per share. This represents a market value of $57.6 million. Brookdale Senior Living plunged 12% to $5.01 on volume seven times its average. Brookdale’s market value is now $923 million. When will it all end? The problem is that it may not end until there is some clarity on when the coronavirus will run its course and what the ultimate economic impact will be. With both Washington state and California declaring a state of emergency, fears among senior living providers grow. If the... Read More »Schedule a demo
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