The United States demographic is currently undergoing a seismic shift as the baby boomers grow old and the age of the domestic population increases.
Many investors have expressed concern about how this will effect the economy. While some areas of the economy may feel pressure from this trend, one sector is certain to grow as a result: healthcare, and healthcare REITs.
LTC Properties (LTC) is well-poised to take advantage of this trend. As a premier owner-operator of healthcare properties, LTC is seeing the demand for its properties increase exponentially.
LTC is an attractive investment for income investors. The stock has an above-average dividend yield (4.8%) and pays these dividends monthly. There are very few stocks that pay monthly dividends, making LTC unique among its peer group.
If you’re interested in owning stocks with monthly dividends, you can see the comprehensive list of monthly dividend stocks here.
While LTC Properties is poised to benefit from our aging demographic, that does not guarantee that the stock will be a strong performer moving forward. Fundamental analysis is still required.
This article will analyze the investment prospects of LTC Properties in detail.
Business Overview
LTC Properties is a healthcare REIT that owns and operates skilled nursing facilities, assisted living facilities, and other healthcare properties.
LTC was incorporated in 1992 and has grown to own more than 200 properties across 30 states. LTC has a market capitalization of $1.9 billion, making it much smaller than other healthcare REITs like Omega Healthcare Investors (OHI), HCP, Inc. (HCP), or Welltower (HCN).
More details about LTC Properties’ business model and recent financial performance can be seen below.
Source:Â LTC Properties Investor Presentation, slide 3
LTC’s property portfolio is divided into two main groups: skilled nursing properties and assisted living properties.
LTC Properties owns 97 skilled nursing properties that compose 52.2% of the market value of its portfolio and 57.6% of its revenues.
Similarly, LTC owns 105 assisted living properties that compose 46.0% of the market value of its portfolio and 41.8% of its total portfolio revenue.
More details of the REIT’s property portfolio can be seen in the following diagram.
Source:Â LTC Properties Investor Presentation, slide 5
Moving on, the next section will discuss the growth prospects of LTC Properties.
