Real Estate

6.4%-Yielding Healthcare Realty Is A Strong 2023 Buy (NYSE:HR)


anton5146

This article was coproduced with Dividend Sensei.

2022 was a crazy year for investors. We saw the highest inflation in 42 years, soaring interest rates, and a meltdown in the UK.

The year ended with the S&P down

Earnings Decline In 2023

2023 S&P Earnings

X 25-Year Average PE Of 16.7

Decline From Current Level

0%

$218.46

$3,648.28

5.0%

5%

$207.54

$3,465.87

9.7%

10%

$196.61

$3,283.45

14.5%

13% (Historically average/median EPS decline)

$190.06

$3,174.01

17.3%

15%

$185.69

$3,101.04

19.2%

20%

$174.77

$2,918.63

24.0%

Metric

Healthcare Trust Of America

Quality

79% 10/13 Blue-Chip Quality MOB REIT

Risk Rating

Medium Risk

DK Master List Quality Ranking (Out Of 500 Companies)

354

DK Master List Quality Percentile

30%

Dividend Growth Streak (Years)

2

Dividend Yield

6.4%

Dividend Safety Score

79%

Average Recession Dividend Cut Risk

1.0%

Severe Recession Dividend Cut Risk

2.20%

S&P Credit Rating

BBB Stable Outlook

30-Year Bankruptcy Risk

7.5%

LT S&P Risk-Management Global Percentile

33% Below-Average, Medium Risk

Fair Value

$30.25

Current Price

$19.27

Discount To Fair Value

36%

DK Rating

Potential Strong Buy

P/FFO

11.5

Historical P/FFO

17.5 to 18

LT Growth Consensus/Management Guidance

2.6%

PEG Ratio

442.31

5-year consensus total return potential

13% to 15% CAGR

Base Case 5-year consensus return potential

14% CAGR (About 2X The S&P 500)

Consensus 12-month total return forecast

30%

Fundamentally Justified 12-Month Return Potential

63%

LT Consensus Total Return Potential

9.0%

Inflation-Adjusted Consensus LT Return Potential

6.6%

FAST Graphs, FactSet

FAST Graphs, FactSet

FAST Graphs, FactSet

FAST Graphs, FactSet

Dividend Kings Automated Investment Decision Tool

Dividend Kings Automated Investment Decision Tool

Metric

2022 Growth Consensus

2023 Growth Consensus

2024 Growth Consensus

2025 Growth Consensus

Sales

23%

50%

2%

NA

Dividend

3%

1%

2%

NA

FFO

-5%

0%

4%

3%

AFFO

3%

1%

12%

11%

EBITDA

-34%

58%

5%

-2%

EBIT (operating income)

-56%

85%

9%

-11%

Investment Strategy

Yield

LT Consensus Growth

LT Consensus Total Return Potential

Long-Term Risk-Adjusted Expected Return

Healthcare Realty

6.4%

2.6%

9.0%

6.3%

REITs

3.9%

6.1%

10.0%

7.0%

Schwab US Dividend Equity ETF

3.4%

7.6%

11.0%

7.7%

Vanguard Dividend Appreciation ETF

1.9%

10.2%

12.1%

8.5%

Dividend Aristocrats

1.9%

8.5%

10.4%

7.3%

S&P 500

1.8%

8.5%

10.3%

7.2%

Nasdaq

0.8%

10.9%

11.7%

8.2%

Metric

Historical Fair Value Multiples (all Years)

2022

2023

2024

2025

12-Month Forward Fair Value

5-Year Average Yield

3.99%

$31.08

$31.08

$31.08

NA

13-year median yield

4.15%

$29.88

$29.88

$29.88

NA

P/FFO

17.75

$29.82

$29.82

$30.89

$31.42

Average

$29.82

$30.25

$30.60

$31.42

$30.25

Current Price

$19.27

Discount To Fair Value

35.38%

36.29%

37.04%

38.66%

36.31%

Upside To Fair Value (including dividend)

54.75%

56.97%

58.82%

63.04%

63.44%

2023 FFO

2024 FFO

2022 Weighted FFO

2023 Weighted FFO

12-Month Forward FFO

Historical Average Fair Value Forward P/FFO

Current Forward P/FFO

$1.68

$1.74

$1.65

$0.03

$1.68

18.0

11.5

Rating

Margin Of Safety For Medium-Risk 10/13 Blue-Chip Quality Companies

2023 Fair Value Price

2024 Fair Value Price

12-Month Forward Fair Value

Potentially Reasonable Buy

0%

$30.25

$30.60

$30.25

Potentially Good Buy

20%

$24.20

$24.48

$24.20

Potentially Strong Buy

30%

$21.17

$21.42

$21.18

Potentially Very Strong Buy

40%

$14.52

$18.36

$18.15

Potentially Ultra-Value Buy

50%

$15.12

$15.30

$15.13

Currently

$19.27

36.29%

37.04%

36.31%

Upside To Fair Value (Including Dividends)

63.40%

65.26%

63.44%

Classification

S&P LT Risk-Management Global Percentile

Risk-Management Interpretation

Risk-Management Rating

BTI, ILMN, SIEGY, SPGI, WM, CI, CSCO, WMB, SAP, CL

100

Exceptional (Top 80 companies in the world)

Very Low Risk

Strong ESG Stocks

86

Very Good

Very Low Risk

Foreign Dividend Stocks

77

Good, Bordering On Very Good

Low Risk

Ultra SWANs

74

Good

Low Risk

Dividend Aristocrats

67

Above-Average (Bordering On Good)

Low Risk

Low Volatility Stocks

65

Above-Average

Low Risk

Master List average

61

Above-Average

Low Risk

Dividend Kings

60

Above-Average

Low Risk

Hyper-Growth stocks

59

Average, Bordering On Above-Average

Medium Risk

Dividend Champions

55

Average

Medium Risk

Monthly Dividend Stocks

41

Average

Medium Risk

Healthcare Realty

33

Below-Average

Medium Risk



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