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Stifel Downgrades Ventas To Hold, Cites Slower Growth


Stifel issued a report on Ventas, Inc. (NYSE: VTR) after analysts reduced company estimates based on slowing growth assumptions. The firm downgraded Ventas from Buy to Hold, while a price target is currently unavailable.

Analysts Chad Vanacore and Seth Canetto wrote, "We are lowering our rating from Buy to Hold assuming a slowing growth rate on fewer acquisitions and slowing organic growth. We reduced our external investment forecast, seeing a more challenging acquisition environment in 2016...believe public REITS are less likely to pay premium prices, so they will slow their growth through acquisitions."

Analysts at Stifel cited two key reasons why they downgraded Ventas.

Challenging Acquisition Environment

Analysts at Stifel noted that there is a disconnect between what public buyers are willing to pay for properties and the premium prices that sellers are expecting. Furthermore, the rising costs of capital have slowed the pace of acquisitions, which puts pressure on public REITs such as Ventas who may be unlikely to pay high prices for investment properties.

Low margin growth

Stifel believes that with the increasing costs of healthcare employees, particularly those at senior housing facilities, expense growth for healthcare REIT's may increase, leading to a strain on operating margins.

Latest Ratings for VTR

Apr 2021SMBC NikkoUpgradesNeutralOutperform
Mar 2021Morgan StanleyMaintainsEqual-Weight
Jan 2021BMO CapitalDowngradesMarket PerformUnderperform

View More Analyst Ratings for VTR
View the Latest Analyst Ratings


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Posted-In: Chad Vanacore Seth Canetto Stifel NicolausAnalyst Color Downgrades Price Target Analyst Ratings

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