UPDATE: Stifel Nicolaus Downgrades Senior Housing Properties Trust to Hold on Valuation
Stifel Nicolaus downgraded Senior Housing Properties Trust (NYSE: SNH) from Buy to Hold and removed the price target of $25.00.
Stifel Nicolaus commented, "We can argue, even with an outside management structure, that SNH should trade above NAV, like most healthcare REITs, since the company has a consistent acquisition pipeline, very low reimbursement risk (nearly zero) and improving long-term internal growth from senior housing operating assets However, we also believe the recent equity issuance priced below NAV will limit near-term upside in the shares. Aside from NAV, we look at the implied yield versus 10-year treasury spread to gauge value versus interest rates / capital costs. SNH current yield to treasuries spread is 520bps, nearly inline with historical averages, implying shares are fairly valued at this time."
Senior Housing Properties Trust closed at $25.18 on Friday.
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