Download PDF

1. Company Snapshot

1.a. Company Description

Healthcare Realty Trust is a real estate investment trust that integrates owning, managing, financing and developing income-producing real estate properties associated primarily with the delivery of outpatient healthcare services throughout the United States.As of September 30, 2020, the Company owned 211 real estate properties in 24 states totaling 15.5 million square feet and was valued at approximately $5.5 billion.The Company provided leasing and property management services to 11.9 million square feet nationwide.

Show Full description

1.b. Last Insights on HR

Healthcare Realty Trust Incorporated's recent performance was positively driven by strong Q2 2025 earnings, with Normalized FFO per share at $0.41, exceeding analyst estimates. The company's strategic transformation and improved operational efficiency contributed to the beat. A reduction in the size of its Board of Directors to 7 members from 12 aimed to enhance governance and align with industry best practices. Additionally, management expressed optimism about accelerating earnings growth in 2026-2027, citing resilient cash flows and potential dividend growth.

1.c. Company Highlights

2. Healthcare Realty Trust's Strong 2025 Results and Promising Outlook

Healthcare Realty Trust Incorporated reported a strong 2025, with normalized FFO of $1.61 per share, exceeding guidance by $0.03. The actual EPS came out at $0.4, in line with estimates. Same-store NOI growth was 4.8%, surpassing the midpoint of guidance by 140 basis points. The company's execution of approximately 5,800,000 square feet of leases, with a weighted average lease term of nearly six years and annual escalators of 3.1%, drove this growth.

Publication Date: Feb -16

📋 Highlights
  • Outperformed Guidance: Normalized FFO of $1.61/share, exceeding guidance by $0.03/share, with 4.8% same-store NOI growth surpassing midpoint by 140 bps.
  • Strong Leasing Activity: Executed 5.8M sq ft of leases with 6-year terms and 3.1% annual escalators, driving retention above 80%.
  • Strategic Plan Progress: Achieved $10M annual G&A savings, sold $1.2B in assets at 6.7% cap rate, and reduced net debt/EBITDA to 5.4x.
  • 2026 Guidance & Capital Allocation: Targeting $1.58-$1.64/share normalized FFO; $50M stock buyback executed, with $450M remaining under authorization.

Operational Highlights

The company has made significant progress on its three-year strategic plan, including revamping its asset management platform, achieving $10,000,000 in run-rate G&A savings, and completing its asset disposition plan, selling $1,200,000,000 of assets at a 6.7% cap rate. This plan has positioned the company for continued success, with a focus on redevelopments, returning capital to shareholders through stock buybacks, and joint venture transactions.

Guidance and Outlook

For 2026, the company guides for normalized FFO of $1.58 to $1.64 per share, with same-store cash NOI growth of 3.5% to 4.5%. Analysts estimate next year's revenue growth at 2.7%. The company's balance sheet is expected to remain stable, with full-year leverage in the mid-5x net debt to EBITDA range. The company has a $600,000,000 commercial paper program to diversify its capital sources and reduce interest costs.

Valuation and Metrics

With a current dividend yield of 6.12% and a P/E Ratio of -25.52, the company's valuation metrics indicate a potentially undervalued stock. The EV/EBITDA ratio of 9.33 and Net Debt / EBITDA of 3.97 suggest a stable financial position. As the company continues to execute its strategic plan, creating value for shareholders through redevelopments, joint ventures, and accretive deals, its valuation may expand, reflecting its strong fundamentals in outpatient medical assets.

Growth Opportunities

The company sees opportunities in redeveloping its portfolio, with $90 million of NOI upside and $50 million from expansion. External growth will primarily be pursued through joint ventures due to high capital costs. The company's existing JV arrangements and potential for new ones will drive growth, with a focus on accretive deals and a hurdle rate of low 7s cap rate.

3. NewsRoom

Card image cap

Healthcare Realty Trust Incorporated (NYSE:HR) Receives Average Recommendation of “Hold” from Brokerages

Feb -27

Source: defenseworld.net

Card image cap

AlphaQuest LLC Cuts Holdings in Healthcare Realty Trust Incorporated $HR

Feb -16

Source: defenseworld.net

Card image cap

H&R Real Estate Investment Trust (HR.UN:CA) Q4 2025 Earnings Call Transcript

Feb -13

Source: seekingalpha.com

Card image cap

Healthcare Realty Trust Incorporated (HR) Q4 2025 Earnings Call Transcript

Feb -13

Source: seekingalpha.com

Card image cap

Healthcare Realty Trust (HR) Q4 FFO Meet Estimates

Feb -12

Source: zacks.com

Card image cap

Healthcare Realty Trust Announces $600 Million Commercial Paper Program

Feb -12

Source: globenewswire.com

Card image cap

Healthcare Realty Reports Fourth Quarter 2025 Results

Feb -12

Source: globenewswire.com

Card image cap

Allianz Asset Management GmbH Acquires 140,396 Shares of Healthcare Realty Trust Incorporated $HR

Feb -09

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (1.97%)

6. Segments

Rental

Expected Growth: 2.0%

Rental growth of 2.0% in Healthcare Realty Trust Incorporated is driven by increasing demand for medical office buildings and outpatient facilities, fueled by an aging population and healthcare reform. Additionally, the company's strategic acquisitions and development of high-quality properties in strong markets contribute to rental growth, while a stable tenant base and long-term leases provide a solid foundation for future growth.

Other Operating

Expected Growth: 1.5%

Healthcare Realty Trust's 1.5% Other Operating growth is driven by increasing demand for medical office buildings and outpatient facilities, fueled by an aging population and healthcare reform. Additionally, strategic acquisitions and expansions into high-growth markets, such as ambulatory surgery centers and medical office buildings, contribute to the segment's growth.

Interest Income

Expected Growth: 0.5%

Healthcare Realty Trust's 0.5% interest income growth is driven by increasing demand for healthcare services, aging population, and strategic acquisitions of medical office buildings and healthcare facilities. Additionally, the company's focus on high-quality tenants, long-term leases, and strong property management practices contribute to stable and growing interest income.

7. Detailed Products

Medical Office Buildings

Healthcare Realty Trust Incorporated owns and operates medical office buildings, providing healthcare providers with convenient and accessible facilities to deliver patient care.

Outpatient Surgery Centers

The company develops and operates outpatient surgery centers, offering a range of surgical procedures and medical treatments.

Urgent Care Centers

Healthcare Realty Trust Incorporated develops and operates urgent care centers, providing immediate, non-emergency care for patients.

Medical Retail

The company develops and operates retail spaces for healthcare-related businesses, such as pharmacies, medical supply stores, and health food stores.

Healthcare-Focused Industrial Properties

Healthcare Realty Trust Incorporated owns and operates industrial properties, such as medical device manufacturing facilities and pharmaceutical distribution centers.

8. Healthcare Realty Trust Incorporated's Porter Forces

Forces Ranking

Threat Of Substitutes

Healthcare Realty Trust Incorporated operates in a niche market, providing healthcare facilities and services. While there are substitutes available, they are limited, and the company's specialized services reduce the threat of substitutes.

Bargaining Power Of Customers

Healthcare Realty Trust Incorporated's customers are primarily healthcare providers and medical professionals. They have limited bargaining power due to the specialized nature of the company's services and the lack of alternative options.

Bargaining Power Of Suppliers

Healthcare Realty Trust Incorporated relies on a network of suppliers for construction, maintenance, and other services. While suppliers have some bargaining power, the company's scale and diversified supplier base mitigate this risk.

Threat Of New Entrants

Entering the healthcare realty market requires significant capital investment and expertise. Barriers to entry, such as regulatory hurdles and high startup costs, limit the threat of new entrants.

Intensity Of Rivalry

The healthcare realty market is moderately competitive, with a few established players. While there is some rivalry, the company's diversified portfolio and strong relationships with healthcare providers mitigate the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 42.28%
Debt Cost 5.13%
Equity Weight 57.72%
Equity Cost 7.19%
WACC 6.32%
Leverage 73.24%

11. Quality Control: Healthcare Realty Trust Incorporated passed 1 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
CareTrust REIT

A-Score: 7.1/10

Value: 2.5

Growth: 3.9

Quality: 8.3

Yield: 9.0

Momentum: 9.0

Volatility: 10.0

1-Year Total Return ->

View Full Report
Stock-Card
Omega Healthcare

A-Score: 6.9/10

Value: 2.9

Growth: 3.0

Quality: 7.3

Yield: 10.0

Momentum: 8.0

Volatility: 10.0

1-Year Total Return ->

View Full Report
Stock-Card
Sabra Health Care REIT

A-Score: 6.8/10

Value: 4.0

Growth: 3.4

Quality: 6.8

Yield: 10.0

Momentum: 7.0

Volatility: 9.7

1-Year Total Return ->

View Full Report
Stock-Card
Healthcare Realty Trust

A-Score: 6.4/10

Value: 5.9

Growth: 2.9

Quality: 5.4

Yield: 10.0

Momentum: 5.5

Volatility: 9.0

1-Year Total Return ->

View Full Report
Stock-Card
Medical Properties Trust

A-Score: 5.7/10

Value: 6.9

Growth: 0.9

Quality: 4.4

Yield: 10.0

Momentum: 8.0

Volatility: 4.0

1-Year Total Return ->

View Full Report
Stock-Card
Ventas

A-Score: 5.6/10

Value: 1.4

Growth: 3.6

Quality: 3.2

Yield: 7.0

Momentum: 9.0

Volatility: 9.7

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

18.39$

Current Price

18.39$

Potential

-0.00%

Expected Cash-Flows