While noting that HCP, Inc. HCP is set to spin off HCR ManorCare into a separate publicly traded REIT, named Quality Care Properties (QCP), Argus said the spinoff is unlikely to materially benefit the company until 2017.
Nevertheless, the company is expected to reap the benefits of favorable demographics, a high quality real estate portfolio and a healthy balance sheet.
Additionally, the company's stock may also be alluring to investors who look for income accretion. That said, the threat of a Fed rate hike looms large, as REITS would be hurt by rising rate environment.
The brokerage raised its FFO estimate for the company to $2.83 from $2.77, premised on the release of better than expected second quarter results and the revised guidance.
Argus has a Hold rating on shares, although the firm spoke about revisiting the rating once the effects of the spin-ff becomes clearer in the coming quarters.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
date | ticker | name | Price Target | Upside/Downside | Recommendation | Firm |
---|
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.