Tag - Nhi

Investors seeking a safe haven from stock market turmoil may want to look to  healthcare REITs National Health Investors, Inc. (NYSE:NHI) and Omega Healthcare Investors, Inc. (NYSE:OHI) for steady growth, generous dividends and reasonable valuations. 

Healthcare REITs (or real-estate investment trusts) own long-term care facilities, medical office buildings and related medical assets. This group is positioned for steady growth as aging baby boomers reach retirement age and demand more healthcare-related services. Healthcare REITs are generally immune to the effects of economic downturns; their occupancies and rents that are more stable than other REIT types. REITs offer attractive dividends since they must pay out the majority of their earnings to shareholders to retain their REIT status. REITs also help diversify investment portfolios; according to industry trade association NAREIT, the correlation rate between REITs and the S&P 500 averages only 37%.
 
Omega Healthcare Investors, Inc. owns or holds mortgages on 241 skilled-nursing facilities, seven assisted-living facilities and four rehabilitation hospitals. Omega’s properties are spread across 29 states and many tenants. The company has invested over $1.9 billion in these facilities. Omega’s largest tenant, CommuniCare Health Services, represents 22% of the portfolio. 

During the six months ended June 30, 2008, Omega produced net income of $34.4 million, or $0.41 per share, on operating revenues of $84.6 million. This compares with net income totaling $36.7 million, or $0.50 per share, on operating . . .

National Health Investors (NYSE:NHI), headquartered in Murfreesboro, Tenn., is a real estate investment trust — more commonly known as a REIT — that invests primarily in income-producing healthcare properties with emphasis on the long-term health care sector.

REITS have great tax benefits for shareholders and an operating model that can generate a liquidity surplus. They are also required to distribute roughly 90% of earnings to shareholders.

What makes National Health particularly attractive is its concentration in health care-related real estate. The company’s entire portfolio is made up of properties such as medical office buildings, residential projects for the developmentally disabled and long-term care facilities. Unlike the demand for shopping malls or condominium complexes, the demand for health care never dwindles and is not significantly affected by economic downturns. The current economic downturn might actually be a boon for doctors, particularly those in the business of treating stress-related maladies. As long as there are doctors, hospitals and treatment facilities, there will be a demand for the real estate they occupy. Owning and leasing those types of properties is National Health’s business.

Making the company even more of a shelter in the current economic hurricane is its investments in assisted-living facilities and retirement centers. These . . .