Critical Contrast: NexPoint Residential Trust (NXRT) vs. Sabra Health Care REIT (SBRA)
NexPoint Residential Trust (NYSE:NXRT) and Sabra Health Care REIT (NASDAQ:SBRA) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their risk, valuation, dividends, analyst recommendations, earnings, profitability and institutional ownership.
Earnings & Valuation
This table compares NexPoint Residential Trust and Sabra Health Care REIT’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|NexPoint Residential Trust||$144.24 million||6.02||$53.37 million||$1.17||31.59|
|Sabra Health Care REIT||$405.65 million||8.39||$158.38 million||$2.43||7.85|
Institutional & Insider Ownership
63.0% of NexPoint Residential Trust shares are held by institutional investors. Comparatively, 89.2% of Sabra Health Care REIT shares are held by institutional investors. 20.0% of NexPoint Residential Trust shares are held by company insiders. Comparatively, 1.1% of Sabra Health Care REIT shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Volatility & Risk
NexPoint Residential Trust has a beta of 0.59, indicating that its stock price is 41% less volatile than the S&P 500. Comparatively, Sabra Health Care REIT has a beta of 0.56, indicating that its stock price is 44% less volatile than the S&P 500.
NexPoint Residential Trust pays an annual dividend of $1.00 per share and has a dividend yield of 2.7%. Sabra Health Care REIT pays an annual dividend of $1.80 per share and has a dividend yield of 9.4%. NexPoint Residential Trust pays out 85.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sabra Health Care REIT pays out 74.1% of its earnings in the form of a dividend. NexPoint Residential Trust has increased its dividend for 2 consecutive years and Sabra Health Care REIT has increased its dividend for 7 consecutive years. Sabra Health Care REIT is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a summary of current recommendations for NexPoint Residential Trust and Sabra Health Care REIT, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|NexPoint Residential Trust||0||1||2||0||2.67|
|Sabra Health Care REIT||1||6||3||0||2.20|
NexPoint Residential Trust presently has a consensus target price of $34.67, suggesting a potential downside of 6.22%. Sabra Health Care REIT has a consensus target price of $21.73, suggesting a potential upside of 13.87%. Given Sabra Health Care REIT’s higher possible upside, analysts clearly believe Sabra Health Care REIT is more favorable than NexPoint Residential Trust.
This table compares NexPoint Residential Trust and Sabra Health Care REIT’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|NexPoint Residential Trust||-0.82%||-0.49%||-0.11%|
|Sabra Health Care REIT||61.85%||11.80%||5.76%|
Sabra Health Care REIT beats NexPoint Residential Trust on 13 of the 17 factors compared between the two stocks.
About NexPoint Residential Trust
NexPoint Residential Trust is a publicly traded REIT, with its shares listed on the New York Stock Exchange under the symbol "NXRT," primarily focused on acquiring, owning and operating well-located middle-income multifamily properties with "value-add" potential in large cities and suburban submarkets of large cities, primarily in the Southeastern and Southwestern United States. NXRT is externally advised by NexPoint Real Estate Advisors, L.P., an affiliate of Highland Capital Management, L.P., a leading global alternative asset manager and an SEC-registered investment adviser.
About Sabra Health Care REIT
As of June 30, 2018, Sabra's investment portfolio included 487 real estate properties held for investment (consisting of (i) 352 Skilled Nursing/Transitional Care facilities, (ii) 89 Senior Housing communities (?Senior Housing – Leased?), (iii) 24 Senior Housing communities operated by third-party property managers pursuant to property management agreements (?Senior Housing – Managed?) and (iv) 22 Specialty Hospitals and Other facilities), one asset held for sale, one investment in a direct financing lease, 22 investments in loans receivable (consisting of (i) one mortgage loan, (ii) two construction loans, (iii) one mezzanine loan, (iv) one pre-development loan and (v) 17 other loans), 13 preferred equity investments and one investment in an unconsolidated joint venture that owns 172 Senior Housing – Managed communities. As of June 30, 2018, Sabra's real estate properties held for investment included 50,030 beds/units and its unconsolidated joint venture included 7,652 beds/units, spread across the United States and Canada.
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