What happened
Tuesday was a good day to be an investor in specialty real estate investment trust (REIT) Welltower (WELL -0.03%). The company delivered its latest set of quarterly results after market hours Monday, and the market clearly liked what it saw. That positive sentiment propelled Welltower stock to a more than 8% gain today.
So what
Welltower's third quarter saw it earn just over $1.47 billion in revenue, which represented growth of almost 19% on a year-over-year basis. It was also slightly better than the collective analyst estimate of $1.46 billion, according to Zack's.
Normalized funds from operations (FFO), considered the most crucial profitability metric for REITs, clocked in at nearly $395 million, or $0.84 per share. That broadly met prognosticator forecasts, and was up from the year-ago result of $343 million.
Concurrently, Welltower announced that it reached agreement with its partner ProMedica to sell 147 skilled nursing facilities currently operated by the latter. ProMedica and the REIT have a joint venture holding those assets, and Welltower said ProMedica would surrender its 15% stake in the entity. (Welltower holds the remaining 85%.)
The buyer of the facilities has agreed to an 85/15 joint venture, this one a collaboration of Welltower (holding the 85%) and Integra Health. The joint venture is to be established by the end of this year. Welltower did not divulge the financial details of its arrangements with either ProMedica or Integra Health.
Now what
Welltower also proffered limited guidance for its current (fourth) quarter. The REIT is modeling normalized FFO of $0.80 to $0.85 per share, which would roughly match the third-quarter result.
