JMP Securities analyst Aaron Hecht has reiterated their neutral stance on GMRE stock, giving a Hold rating on May 7.
Aaron Hecht has given his Hold rating due to a combination of factors including the recent financial performance and strategic actions taken by Global Medical REIT. The REIT’s core Funds from Operations (FFO) in the first quarter of 2024 met the expectations of both Citizens JMP and the consensus. The acquisition of a new portfolio at an attractive capitalization rate suggests potential for portfolio improvement and asset growth. However, the loss of a significant tenant, which previously contributed a substantial portion of annual Net Operating Income (NOI), tempers the positives and adds a degree of uncertainty to future earnings.
Furthermore, Hecht considers the current valuation of GMRE’s stock to be fair when accounting for the company’s market capitalization, higher leverage, and growth profile in comparison to its healthcare REIT peers. While the REIT’s stock trades at a discount relative to its future twelve months’ Net Asset Value, this is consistent with historical trends. Adjustments to core FFO estimates for 2024 and 2025 have been made, lowering expectations due to the bankruptcy of a tenant, although this is partially offset by capital recycling activities. All of these factors contribute to the Hold rating, suggesting that while the company has solid prospects, there are also risks and uncertainties that need to be considered.
According to TipRanks, Hecht is a 3-star analyst with an average return of 2.7% and a 51.35% success rate. Hecht covers the Real Estate sector, focusing on stocks such as Sun Communities, LTC Properties, and American Homes.
In another report released on May 7, BMO Capital also maintained a Hold rating on the stock with a $10.00 price target.
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Global Medical REIT (GMRE) Company Description:
Global Medical REIT, Inc. engages in the acquisition of purpose-built healthcare facilities and leasing of those properties to strong healthcare systems and physician groups. The company was founded on March 18, 2011 and is headquartered in Bethesda, MD.
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