In a nutshell, whatever the cause may be, if the vacancy rates of HCP's properties rise, it could hurt HCP's bottom line and cause the stock to drop. Rising interest rates Of these risk factors, the most likely to happen in my opinion, is the effect of rising interest rates of REITs in general.
Full Answer
Is HCP a good buy?
Out of 12 analysts, 2 (16.67%) are recommending HCP as a Strong Buy, 4 (33.33%) are recommending HCP as a Buy, 6 (50%) are recommending HCP as a Hold, 0 (0%) are recommending HCP as a Sell, and 0 (0%) are recommending HCP as a Strong Sell.
Is Hmpt a buy?
Out of 9 analysts, 0 (0%) are recommending HMPT as a Strong Buy, 1 (11.11%) are recommending HMPT as a Buy, 5 (55.56%) are recommending HMPT as a Hold, 1 (11.11%) are recommending HMPT as a Sell, and 2 (22.22%) are recommending HMPT as a Strong Sell.
Is 111 inc a buy?
Is 111, Inc. stock A Buy? 111, Inc. holds several negative signals and we believe that it will still perform weakly in the next couple of days or weeks. We, therefore, hold a negative evaluation of this stock.
Is Denbury a buy?
Denbury has received a consensus rating of Buy. The company's average rating score is 2.89, and is based on 8 buy ratings, 1 hold rating, and no sell ratings.
Is Home Point Financial publicly traded?
ANN ARBOR, MI, January 28, 2021 — Home Point Capital Inc. ("Home Point Capital"), the parent entity of Homepoint, today announced the pricing of its initial public offering of 7,250,000 shares of its common stock at $13.00 per share.
HCP isn't a high-risk REIT, but it isn't bulletproof either
Matt is a Certified Financial Planner based in South Carolina who has been writing for The Motley Fool since 2012. Matt specializes in writing about bank stocks, REITs, and personal finance, but he loves any investment at the right price. Follow him on Twitter to keep up with his latest work! Follow @TMFMathGuy
Slower-than-expected demand growth
The reasons to invest in healthcare real estate for the long term include the expectation of soaring demand, especially for senior housing properties, HCP's bread-and-butter.
Rising interest rates
Of these risk factors, the most likely to happen in my opinion, is the effect of rising interest rates of REITs in general. Since the Federal Reserve is anticipating three rate hikes in 2017 and several more in 2018 and 2019, this is a risk all REIT investors should keep in mind.
Problems with partners or tenants
HCP, like many REITs, bases its business model on establishing relationships with tenants and operating partners. Most of HCP's portfolio is leased to tenants on a triple-net basis, but about one-fifth is operated by HCP along with partners.
Think long term with HCP
All of these could certainly happen. We already saw what operating partner weakness can do to a healthcare REIT -- HCP's stock got crushed when its HCR ManorCare portfolio of properties caused a surprise loss early last year. And, interest rates were the main reason most REITs performed poorly in the latter half of 2016.
Slower-Than-Expected Demand Growth
Rising Interest Rates
- Of these risk factors, the most likely to happen in my opinion, is the effect of rising interest rates of REITs in general. Since the Federal Reserve is anticipating three rate hikes in 2017 and several more in 2018 and 2019, this is a risk all REIT investors should keep in mind. For starters, rising interest rates make it more expensive for REITs to borrow money. I wouldn't call HCP a "high deb…
Problems with Partners Or Tenants
- HCP, like many REITs, bases its business model on establishing relationships with tenants and operating partners. Most of HCP's portfolio is leased to tenants on a triple-net basis, but about one-fifth is operated by HCP along with partners. While HCP got rid of its riskiest assets in 2016, it does still rely heavily on a few tenants. Specifically, 64% of the senior housing portfolio is operat…
Think Long Term with Hcp
- All of these could certainly happen. We already saw what operating partner weakness can do to a healthcare REIT -- HCP's stock got crushed when its HCR ManorCare portfolio of properties caused a surprise loss early last year. And, interest rates were the main reason most REITs performed poorly in the latter half of 2016. However, any weakness in th...