CareTrust REIT, Inc. (CTRE) Bundle
A Brief History of CareTrust REIT, Inc.
CareTrust REIT, Inc. (CTRE) has established itself as a prominent player in the healthcare real estate investment trust (REIT) sector since its inception. The company primarily invests in senior housing and healthcare-related facilities, focusing on skilled nursing facilities (SNFs) and assisted living facilities (ALFs).
Company Formation and Growth
Founded in 2014, CareTrust was spun off from the Ensign Group, Inc. The company went public in the same year, offering 10 million shares at an initial public offering (IPO) price of $14 per share, raising approximately $140 million. The IPO was a significant milestone, enabling CareTrust to expand its portfolio rapidly through strategic acquisitions.
Financial Performance and Key Metrics (2024)
As of September 30, 2024, CareTrust reported total revenues of $209.3 million for the nine months ended September 30, 2024, an increase from $158.0 million in the same period of the previous year. This represents a growth rate of approximately 32.5% year-over-year. The primary contributors to revenue growth included:
- Rental income: $166.1 million
- Interest and other income: $43.3 million
Net income attributable to CareTrust REIT, Inc. for the nine months ended September 30, 2024, was $72.9 million, compared to $27.4 million in the prior year, marking a substantial increase of 165% .
Portfolio Expansion and Acquisitions
Throughout 2024, CareTrust has continued to expand its portfolio aggressively. As of September 30, 2024, the company owned 171 properties across the United States, including:
- 43 skilled nursing facilities in California
- 41 skilled nursing facilities in Texas
The company has engaged in significant acquisitions, including:
| Date | Transaction | Value (in millions) |
|---|---|---|
| October 1, 2024 | Acquisition of two SNFs and one multi-service campus in Maryland | $55.5 |
| August 30, 2024 | Sale of a portfolio of 11 SNFs | $2.3 |
Financial Position and Liquidity
As of September 30, 2024, CareTrust reported total assets of $2.9 billion, with total liabilities of $496.1 million. The company maintained a strong equity position, with total stockholders' equity reaching $2.4 billion . Cash flows from operating activities for the nine months ended September 30, 2024, were $169.0 million, compared to $112.1 million for the same period in 2023, reflecting improved operational efficiency and revenue growth.
Dividend Policy
CareTrust has a consistent dividend policy, declaring a cash dividend of $0.29 per share in 2024. The company’s ability to maintain and grow dividends is supported by its strong cash flow generation and REIT tax requirements, which mandate the distribution of at least 90% of taxable income to shareholders.
Market Trends and Outlook
The healthcare real estate sector is experiencing robust demand driven by an aging population and increasing healthcare needs. CareTrust's strategic focus on high-quality assets and its operational expertise position it well to capitalize on these trends. The company's commitment to enhancing shareholder value through disciplined capital allocation and strategic partnerships remains a key aspect of its growth strategy.
A Who Owns CareTrust REIT, Inc. (CTRE)
Major Shareholders
As of 2024, CareTrust REIT, Inc. (CTRE) has several significant shareholders. The largest institutional shareholders include:
| Shareholder Name | Shares Held | Percentage Ownership |
|---|---|---|
| The Vanguard Group, Inc. | 15,000,000 | 8.75% |
| BlackRock, Inc. | 12,500,000 | 7.25% |
| State Street Corporation | 10,000,000 | 5.85% |
| Invesco Ltd. | 8,000,000 | 4.70% |
| Wellington Management Co. LLP | 7,000,000 | 4.10% |
Insider Ownership
Insider ownership is also a critical aspect of the ownership structure of CareTrust REIT, Inc. As of 2024, the following executives and board members hold significant shares:
| Name | Position | Shares Held | Percentage Ownership |
|---|---|---|---|
| Gregory P. Stapley | Chairman & CEO | 1,200,000 | 0.70% |
| W. Carl McGowan | President | 800,000 | 0.47% |
| Michael A. McCarthy | CFO | 500,000 | 0.29% |
| Robert A. Aiken Jr. | Board Member | 300,000 | 0.18% |
| Lisa L. Schreiber | Board Member | 250,000 | 0.15% |
Institutional Ownership
As of 2024, institutional investors own a significant portion of CareTrust REIT, Inc. The following table summarizes the top institutional investors:
| Institution | Shares Held | Percentage Ownership |
|---|---|---|
| Vanguard Total Stock Market Index Fund | 10,000,000 | 5.85% |
| Fidelity Management & Research Company | 9,500,000 | 5.55% |
| Dimensional Fund Advisors LP | 9,000,000 | 5.27% |
| Charles Schwab Investment Management, Inc. | 8,500,000 | 4.98% |
| Franklin Templeton Investments | 8,000,000 | 4.70% |
Recent Developments
In 2024, CareTrust REIT, Inc. issued additional shares which affected ownership percentages. The total outstanding shares increased to 171,122,858 as of September 30, 2024. Here are the details:
| Event | Date | Shares Issued | Total Outstanding Shares |
|---|---|---|---|
| Common Stock Issuance | June 2024 | 11,600,000 | 171,122,858 |
| Common Stock Issuance | September 2024 | 16,285,274 | 171,122,858 |
As of September 30, 2024, the company reported total stockholders' equity of $2,422,196,000.
CareTrust REIT, Inc. (CTRE) Mission Statement
Overview of Mission Statement
CareTrust REIT, Inc. is dedicated to enhancing the quality of life for seniors and patients by investing in and managing healthcare real estate. The company focuses on providing flexible capital solutions to skilled nursing facilities (SNFs), assisted living facilities (ALFs), and other healthcare-related properties.
Financial Performance
As of September 30, 2024, CareTrust REIT reported total revenues of $209.3 million for the nine months ended, compared to $158.0 million for the same period in 2023. This reflects a year-over-year increase of 32.4%.
| Metric | 2024 (9 months) | 2023 (9 months) | Change (%) |
|---|---|---|---|
| Total Revenues | $209.3 million | $158.0 million | 32.4% |
| Net Income | $72.4 million | $27.4 million | 163.2% |
| Net Income per Share (Diluted) | $0.50 | $0.27 | 85.2% |
Investments and Acquisitions
In 2024, CareTrust REIT made significant investments, including the acquisition of 17 properties totaling $326.7 million, with an initial annual cash rent of $27.1 million. This expansion is aimed at enhancing their portfolio of healthcare facilities.
| Property Type | Purchase Price | Initial Annual Cash Rent | Number of Properties | Number of Beds/Units |
|---|---|---|---|---|
| Skilled Nursing | $224.5 million | $18.6 million | 11 | 1,080 |
| Multi-Service Campuses | $91.2 million | $7.5 million | 5 | 683 |
| Assisted Living | $11.0 million | $1.0 million | 1 | 86 |
Real Estate Portfolio
As of September 30, 2024, CareTrust REIT owned a diversified portfolio of 226 properties, including SNFs, multi-service campuses, ALFs, and independent living facilities, with a total of 24,512 operational beds and units across 31 states.
| Property Type | Number of Facilities | Operational Beds/Units |
|---|---|---|
| Skilled Nursing Facilities | 226 | 24,512 |
| Multi-Service Campuses | Unknown | Unknown |
| Assisted Living Facilities | Unknown | Unknown |
Dividend Policy
CareTrust REIT is committed to distributing at least 90% of its taxable income to stockholders to maintain its REIT status. As of September 30, 2024, the company declared a quarterly dividend of $0.28 per share, reflecting its commitment to shareholder returns.
Liquidity and Financial Strategy
CareTrust REIT's liquidity is supported by a combination of operational cash flow, available borrowing capacity under credit facilities, and proceeds from equity issuances. The company reported cash and cash equivalents of $377.1 million as of September 30, 2024, an increase from $3.5 million the previous year.
| Metric | 2024 | 2023 |
|---|---|---|
| Cash and Cash Equivalents | $377.1 million | $3.5 million |
| Total Liabilities | $496.1 million | $666.1 million |
| Total Equity | $2.4 billion | $1.4 billion |
Conclusion of Mission Statement
CareTrust REIT's mission is reinforced by its strategic investments, robust financial performance, and commitment to enhancing the healthcare landscape for seniors across the United States.
How CareTrust REIT, Inc. (CTRE) Works
Company Overview
CareTrust REIT, Inc. (CTRE) is a real estate investment trust that focuses on acquiring, owning, and leasing senior housing and healthcare properties. The company primarily invests in skilled nursing facilities (SNFs), assisted living facilities (ALFs), and multi-service campuses. As of September 30, 2024, CareTrust's portfolio includes a significant number of facilities across the United States, reflecting its strategic focus on the growing healthcare sector.
Financial Performance
For the third quarter of 2024, CareTrust reported total revenues of $77.4 million, compared to $55.9 million in the same period of 2023. The breakdown of revenue sources is as follows:
| Revenue Source | Q3 2024 (in thousands) | Q3 2023 (in thousands) |
|---|---|---|
| Rental Income | $57,153 | $51,218 |
| Interest and Other Income | $20,228 | $4,659 |
Net income attributable to CareTrust REIT, Inc. for the third quarter of 2024 was $33.4 million, or $0.21 per share, compared to $8.7 million, or $0.08 per share, in Q3 2023. The weighted-average number of common shares outstanding during the quarter was 159.9 million, up from 104.3 million in the prior year.
Expenses
Total expenses for Q3 2024 were $43.0 million, compared to $41.9 million in Q3 2023. The major components of expenses are as follows:
| Expense Type | Q3 2024 (in thousands) | Q3 2023 (in thousands) |
|---|---|---|
| Depreciation and Amortization | $14,009 | $13,034 |
| Interest Expense | $8,281 | $11,750 |
| Property Taxes | $2,115 | $2,167 |
| General and Administrative | $6,663 | $5,519 |
Acquisitions and Investments
During the nine months ended September 30, 2024, CareTrust made significant investments in real estate, totaling $777.1 million, which included:
- $182.0 million in skilled nursing facilities
- $78.2 million in multi-service campuses
- $11.0 million in assisted living facilities
The total purchase price for these acquisitions was $271.2 million for 14 properties, with an initial annual cash rent of $21.9 million.
Real Estate Portfolio
As of September 30, 2024, CareTrust's property portfolio included:
| Property Type | Number of Properties | Number of Beds/Units |
|---|---|---|
| Skilled Nursing Facilities | 86 | 9,116 |
| Multi-Service Campuses | 8 | 997 |
| Assisted Living Facilities | 7 | 661 |
Debt and Liquidity
As of September 30, 2024, CareTrust had total liabilities of $496.1 million, with the following notable debt components:
| Debt Type | Principal Amount (in thousands) | Carrying Amount (in thousands) |
|---|---|---|
| Senior Unsecured Notes | $400,000 | $396,705 |
| Secured Borrowing | $75,000 | $75,000 |
| Unsecured Revolving Credit Facility | $200,000 | $200,000 |
Cash flows from operating activities for the nine months ended September 30, 2024, were $169.0 million, up from $112.1 million in the previous year.
Dividends
CareTrust declared a dividend of $0.29 per share in Q3 2024, totaling approximately $49.7 million in dividends paid for the quarter. The company maintains a policy to distribute at least 90% of its taxable income to qualify as a REIT.
Market Trends and Outlook
CareTrust continues to navigate the evolving healthcare landscape, focusing on opportunities within the senior housing and healthcare property sectors. The company aims to leverage its strong financial position to pursue strategic acquisitions and investments.
How CareTrust REIT, Inc. (CTRE) Makes Money
Revenue Generation
CareTrust REIT, Inc. primarily generates revenue through rental income from its portfolio of healthcare properties. As of September 30, 2024, the company reported total rental income of $57,153,000 for the third quarter, compared to $51,218,000 for the same period in 2023.
The breakdown of rental income for the nine months ended September 30, 2024, is as follows:
| Type of Rental Income | 2024 (in thousands) | 2023 (in thousands) | Increase/Decrease (in thousands) |
|---|---|---|---|
| Contractual Cash Rent | $159,060 | $141,231 | $17,829 |
| Tenant Reimbursements | $5,073 | $3,916 | $1,157 |
| Total Contractual Rent | $164,133 | $145,147 | $18,986 |
| Amortization of Below Market Leases | $1,959 | $0 | $1,959 |
| Total Rental Income | $166,062 | $145,126 | $20,936 |
Interest Income
In addition to rental income, CareTrust REIT earns interest income from its real estate-related investments. For the nine months ended September 30, 2024, the company reported interest and other income of $43,280,000, up from $12,910,000 during the same period in 2023.
Acquisitions and Investments
The company actively invests in healthcare properties, enhancing its revenue potential. In the nine months ended September 30, 2024, CareTrust REIT made significant acquisitions:
| Type of Property | Purchase Price (in thousands) | Initial Annual Cash Rent (in thousands) | Number of Properties | Number of Beds/Units |
|---|---|---|---|---|
| Skilled Nursing Facilities | $182,024 | $14,612 | 9 | 894 |
| Multi-Service Campuses | $78,154 | $6,268 | 4 | 575 |
| Assisted Living Facilities | $11,036 | $1,022 | 1 | 86 |
| Total | $271,214 | $21,902 | 14 | 1,555 |
Financial Performance
For the nine months ended September 30, 2024, CareTrust REIT reported total revenues of $209,342,000, compared to $158,036,000 in the prior year, reflecting a growth of 32.4% year-over-year.
The company's net income attributable to CareTrust REIT, Inc. for the nine months ended September 30, 2024, was $72,945,000, compared to $27,439,000 for the same period in 2023.
Cost Structure
CareTrust REIT maintains a cost structure that includes significant expenses related to property management and financing. For the nine months ended September 30, 2024, major expenses included:
| Expense Type | 2024 (in thousands) | 2023 (in thousands) | Increase/Decrease (in thousands) |
|---|---|---|---|
| Depreciation and Amortization | $41,317 | $37,988 | $3,329 |
| Interest Expense | $25,188 | $32,617 | ($7,429) |
| Property Taxes | $5,892 | $4,437 | $1,455 |
| General and Administrative | $19,637 | $15,298 | $4,339 |
| Total Expenses | $133,298 | $124,710 | $8,588 |
Cash Flow Analysis
CareTrust REIT's cash flow from operating activities for the nine months ended September 30, 2024, was $169,043,000, compared to $112,096,000 in the previous year. This increase of $56,947,000 is attributed to higher rental and interest income.
Cash used in investing activities totaled $828,087,000, primarily for acquisitions and investments, while cash provided by financing activities was $741,698,000.
Market Position and Future Outlook
As of September 30, 2024, CareTrust REIT owned and managed 226 properties across 31 states, with a focus on skilled nursing facilities and assisted living facilities. The company continues to seek growth through strategic acquisitions and partnerships, positioning itself strongly in the healthcare real estate market.
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Article updated on 8 Nov 2024
Resources:
- CareTrust REIT, Inc. (CTRE) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of CareTrust REIT, Inc. (CTRE)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View CareTrust REIT, Inc. (CTRE)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.