Critical Survey: Welltower (NYSE:WELL) and Community Healthcare Trust (NYSE:CHCT)

Welltower (NYSE:WELL) and Community Healthcare Trust (NYSE:CHCT) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, institutional ownership and profitability.

Insider & Institutional Ownership

94.8% of Welltower shares are held by institutional investors. Comparatively, 87.8% of Community Healthcare Trust shares are held by institutional investors. 0.2% of Welltower shares are held by company insiders. Comparatively, 5.3% of Community Healthcare Trust shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Welltower and Community Healthcare Trust”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Welltower	$10.84 billion	13.93	$936.84 million	$1.40	153.07
Community Healthcare Trust	$121.19 million	4.14	$5.10 million	$0.07	250.69

Welltower has higher revenue and earnings than Community Healthcare Trust. Welltower is trading at a lower price-to-earnings ratio than Community Healthcare Trust, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Welltower has a beta of 0.83, indicating that its stock price is 17% less volatile than the S&P 500. Comparatively, Community Healthcare Trust has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500.

Profitability

This table compares Welltower and Community Healthcare Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Welltower	8.64%	2.46%	1.59%
Community Healthcare Trust	4.21%	1.16%	0.52%

Dividends

Welltower pays an annual dividend of $2.96 per share and has a dividend yield of 1.4%. Community Healthcare Trust pays an annual dividend of $1.91 per share and has a dividend yield of 10.9%. Welltower pays out 211.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Community Healthcare Trust pays out 2,728.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Welltower has raised its dividend for 2 consecutive years and Community Healthcare Trust has raised its dividend for 3 consecutive years. Community Healthcare Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of current ratings and recommmendations for Welltower and Community Healthcare Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Welltower	0	3	10	1	2.86
Community Healthcare Trust	0	3	1	0	2.25

Welltower currently has a consensus price target of $225.43, suggesting a potential upside of 5.19%. Community Healthcare Trust has a consensus price target of $18.00, suggesting a potential upside of 2.58%. Given Welltower’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Welltower is more favorable than Community Healthcare Trust.

Summary

Welltower beats Community Healthcare Trust on 14 of the 18 factors compared between the two stocks.

About Welltower

Welltower Inc. (NYSE:WELL), a real estate investment trust (“REIT”) and S&P 500 company headquartered in Toledo, Ohio, is driving the transformation of health care infrastructure. Welltower invests with leading seniors housing operators, post-acute providers and health systems to fund the real estate infrastructure needed to scale innovative care delivery models and improve people’s wellness and overall health care experience. Welltower owns interests in properties concentrated in major, high-growth markets in the United States, Canada and the United Kingdom, consisting of seniors housing and post-acute communities and outpatient medical properties.

About Community Healthcare Trust

Community Healthcare Trust Incorporated (the Company”, we”, our”) was organized in the State of Maryland on March 28, 2014. The Company is a fully-integrated healthcare real estate company that owns and acquires real estate properties that are leased to hospitals, doctors, healthcare systems or other healthcare service providers. As of March 31, 2024, the Company had investments of approximately $1.1 billion in 197 real estate properties (including a portion of one property accounted for as a sales-type lease with a gross amount totaling approximately $3.0 million and two properties classified as an asset held for sale with an aggregate amount totaling approximately $7.5 million. The properties are located in 35 states, totaling approximately 4.4 million square feet in the aggregate and were approximately 92.3% leased, excluding real estate assets held for sale, at March 31, 2024 with a weighted average remaining lease term of approximately 6.9 years.