Financial Survey: Physicians Realty Trust (DOC) and National Health Investors (NHI)

National Health Investors (NYSE: NHI) and Physicians Realty Trust (NYSE:DOC) are both mid-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, institutional ownership, valuation, earnings, analyst recommendations, dividends and profitabiliy.

Analyst Ratings

This is a breakdown of recent ratings and target prices for National Health Investors and Physicians Realty Trust, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
National Health Investors	1	3	2	0	2.17
Physicians Realty Trust	1	2	11	0	2.71

National Health Investors presently has a consensus target price of $78.80, suggesting a potential upside of 4.10%. Physicians Realty Trust has a consensus target price of $20.83, suggesting a potential upside of 13.91%. Given Physicians Realty Trust’s stronger consensus rating and higher probable upside, analysts plainly believe Physicians Realty Trust is more favorable than National Health Investors.

Dividends

National Health Investors pays an annual dividend of $3.80 per share and has a dividend yield of 5.0%. Physicians Realty Trust pays an annual dividend of $0.92 per share and has a dividend yield of 5.0%. National Health Investors pays out 92.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Physicians Realty Trust pays out 400.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Physicians Realty Trust has raised its dividend for 7 consecutive years. Physicians Realty Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

69.3% of National Health Investors shares are held by institutional investors. Comparatively, 80.2% of Physicians Realty Trust shares are held by institutional investors. 5.2% of National Health Investors shares are held by insiders. Comparatively, 0.5% of Physicians Realty Trust shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares National Health Investors and Physicians Realty Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
National Health Investors	63.72%	13.36%	6.76%
Physicians Realty Trust	11.51%	1.82%	1.17%

Valuation and Earnings

This table compares National Health Investors and Physicians Realty Trust’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	EBITDA	Earnings Per Share	Price/Earnings Ratio
National Health Investors	$255.06 million	12.16	$233.77 million	$4.12	18.37
Physicians Realty Trust	$272.80 million	10.28	$180.00 million	$0.23	79.53

National Health Investors has higher revenue, but lower earnings than Physicians Realty Trust. National Health Investors is trading at a lower price-to-earnings ratio than Physicians Realty Trust, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

National Health Investors has a beta of 0.56, suggesting that its stock price is 44% less volatile than the S&P 500. Comparatively, Physicians Realty Trust has a beta of 0.55, suggesting that its stock price is 45% less volatile than the S&P 500.

Summary

National Health Investors beats Physicians Realty Trust on 9 of the 17 factors compared between the two stocks.

National Health Investors Company Profile

National Health Investors, Inc. is a self-managed real estate investment trust (REIT) specializing in sale-leaseback, joint-venture, mortgage and mezzanine financing of need-driven and discretionary senior housing and medical investments. The Company is engaged in the business of owning and financing healthcare properties. Its portfolio consists of lease, mortgage and other note investments in independent living facilities, assisted living facilities, entrance-fee communities, senior living campuses, skilled nursing facilities, specialty hospitals and medical office buildings. Its other investments include marketable securities and a joint venture structured to comply with the provisions of the REIT Investment Diversification Empowerment Act of 2007 (RIDEA) through which it invests in facility operations managed by an independent third party. As of December 31, 2016, it had investments in real estate, mortgage and other notes receivable involving 205 facilities located in 32 states.

Physicians Realty Trust Company Profile

Physicians Realty Trust (the Trust) is a real estate investment trust. Physicians Realty L.P. is the operating partnership of the Trust. The Trust and its operating partnership are engaged in acquiring, developing, owning and managing healthcare properties that are leased to physicians, hospitals and healthcare delivery systems. As of December 31, 2016, the Company’s portfolio consisted of 246 properties located in 29 states with approximately 10,883,601 net leasable square feet. The Company invests in real estate that is integral to providing healthcare services. The Company focuses its investment activity on various types of healthcare properties, such as medical office buildings; outpatient treatment and diagnostic facilities; physician group practice clinics; ambulatory surgery centers, and specialty hospitals and treatment centers. Its properties include Arrowhead Commons, Aurora Medical Office Building, Decatur Medical Office Building and El Paso Medical Office Building.