UBS predicts there should be good news for investors when senior housing and skilled care companies report their latest financial results this summer. Analyst Michael Goldsmith said in a note Tuesday that the real estate investment trust also pays solid dividends and enjoys sound operating fundamentals and significant acquisition growth. “Operationally, we believe senior housing continues to benefit from slower supply growth and demographic tailwinds,” he said. “Recent conference commentary suggests that many new development projects remain uneconomic at current rents, confirming our expectation that future supply will be limited.” The U.S. population is changing as baby boomers age and birth rates decline. This year, the first generation of baby boomers begins to turn 80 years old. By 2035, the number of people aged 80 and over is expected to reach approximately 23 million people, an increase from the estimated population of approximately 15 million people in this age group in July 2025. According to the National Senior Housing and Care Investment Center, demand is currently outpacing the construction of new senior housing. Occupancy rates approached 90% in the second quarter, according to NIC MAP data released Thursday. In addition to supply and demand conditions, the environment is healthy for acquisitions, Goldsmith said. Stocks Rated as Buys Although UBS is bullish on the subsector, there are some stocks that we think are better than others. The firm rates American Healthcare REIT, CareTrust REIT, Omega Healthcare Investors, and Welltower as buys. American Healthcare REIT, which has a dividend yield of 1.89%, is scheduled to announce its second quarter results on August 6th. Goldsmith believes external growth will continue to be the primary revenue driver for the company, which has a portfolio of 325 health care facilities, including senior housing and skilled nursing facilities. He raised his price target on the stock to $63 from $60, implying a 17% upside from Thursday’s closing price. “AHR recently raised approximately $700 million in equity to fund the acquisition of the SHOP pipeline, which exceeds $1 billion,” Goldsmith wrote. “This equity increase strengthens AHR’s confidence in both the deal opportunity and the economics of the acquisition, and we believe the initial yield will be in the high 5% to low 6% range.” He estimates the 2026 core fund will be $2.10 per share, compared to the consensus of $2.07 per share. AHR YTD Mountain American Healthcare REIT Year-to-date stock has increased 13% since the beginning of the year. Goldsmith also raised Welltower’s price target to $271 per share from $249, suggesting 17% upside potential. The company owns and operates more than 2,500 senior housing and wellness housing communities. The company is scheduled to announce earnings on July 27th. He said the new targets reflect positive meetings with UBS and management, recent improvements in the company’s cost of capital, as well as Welltower’s latest update detailing similar or slightly improving growth trends and a continued mix shift towards operating asset expansion. Its operating platform, known as Welltower Business Systems, has also been improved, he said. Goldsmith’s 2026 core FFO forecast is $6.27 per share, slightly below consensus of $6.29. Welltower’s dividend yield is 1.29%, up 24% since the beginning of the year. WELL YTD MOUNTAIN WELL TOWER YTD YTD Finally, he maintained his price targets on CareTrust REIT and Omega Healthcare Investors at $48 and $54, respectively. This means there is 17% upside potential for CareTrust and 11% for Omega Healthcare. He said Caretrust, which yields 3.88%, is increasingly benefiting from its expansion into care homes and seniors’ housing in the UK. The company has 588 properties in its portfolio. CareTrust has not announced its next earnings date, but it is estimated that it will be released in early August. Mr Goldsmith said: “CTRE remains highly opportunistic across seniors housing and stands ready to take on a wide range of opportunities, from regeneration to new development assets.” Goldsmith forecasts core FFO of $2.04 per share in 2026, in line with consensus expectations. For Omega Healthcare, he said he expects full-year core FFO to be $3.25 per share, compared to the consensus of $3.26. Omega Healthcare’s portfolio of more than 1,000 facilities primarily includes skilled nursing facilities and assisted living facilities. The company’s dividend yield is currently 5.57%, and its financial results are scheduled to be announced on July 30th. Omega Healthcare stock is up 9% year to date in 2026, while CareTrust REIT is up 11%.
