Head to Head Review: Welltower (NYSE:WELL) & Community Healthcare Trust (NYSE:CHCT)

Community Healthcare Trust (NYSE:CHCT) and Welltower (NYSE:WELL) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their risk, profitability, earnings, institutional ownership, analyst recommendations, valuation and dividends.

Volatility & Risk

Community Healthcare Trust has a beta of 0.74, suggesting that its share price is 26% less volatile than the S&P 500. Comparatively, Welltower has a beta of 0.83, suggesting that its share price is 17% less volatile than the S&P 500.

Valuation & Earnings

This table compares Community Healthcare Trust and Welltower”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Community Healthcare Trust	$121.19 million	4.06	$5.10 million	$0.07	245.97
Welltower	$10.84 billion	13.31	$936.84 million	$1.40	147.68

Welltower has higher revenue and earnings than Community Healthcare Trust. Welltower is trading at a lower price-to-earnings ratio than Community Healthcare Trust, indicating that it is currently the more affordable of the two stocks.

Dividends

Community Healthcare Trust pays an annual dividend of $1.91 per share and has a dividend yield of 11.1%. Welltower pays an annual dividend of $2.96 per share and has a dividend yield of 1.4%. Community Healthcare Trust pays out 2,728.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Welltower pays out 211.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Community Healthcare Trust has increased its dividend for 3 consecutive years and Welltower has increased its dividend for 2 consecutive years. Community Healthcare Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Community Healthcare Trust and Welltower, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Community Healthcare Trust	0	3	1	0	2.25
Welltower	1	3	10	1	2.73

Community Healthcare Trust currently has a consensus target price of $18.00, indicating a potential upside of 4.54%. Welltower has a consensus target price of $225.43, indicating a potential upside of 9.04%. Given Welltower’s stronger consensus rating and higher possible upside, analysts plainly believe Welltower is more favorable than Community Healthcare Trust.

Insider and Institutional Ownership

87.8% of Community Healthcare Trust shares are owned by institutional investors. Comparatively, 94.8% of Welltower shares are owned by institutional investors. 5.3% of Community Healthcare Trust shares are owned by insiders. Comparatively, 0.2% of Welltower shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Community Healthcare Trust and Welltower’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Community Healthcare Trust	4.21%	1.16%	0.52%
Welltower	8.64%	2.46%	1.59%

Summary

Welltower beats Community Healthcare Trust on 14 of the 18 factors compared between the two stocks.

About Community Healthcare Trust

Community Healthcare Trust Incorporated (the Company”, we”, our”) was organized in the State of Maryland on March 28, 2014. The Company is a fully-integrated healthcare real estate company that owns and acquires real estate properties that are leased to hospitals, doctors, healthcare systems or other healthcare service providers. As of March 31, 2024, the Company had investments of approximately $1.1 billion in 197 real estate properties (including a portion of one property accounted for as a sales-type lease with a gross amount totaling approximately $3.0 million and two properties classified as an asset held for sale with an aggregate amount totaling approximately $7.5 million. The properties are located in 35 states, totaling approximately 4.4 million square feet in the aggregate and were approximately 92.3% leased, excluding real estate assets held for sale, at March 31, 2024 with a weighted average remaining lease term of approximately 6.9 years.

About Welltower

Welltower Inc. (NYSE:WELL), a real estate investment trust (“REIT”) and S&P 500 company headquartered in Toledo, Ohio, is driving the transformation of health care infrastructure. Welltower invests with leading seniors housing operators, post-acute providers and health systems to fund the real estate infrastructure needed to scale innovative care delivery models and improve people’s wellness and overall health care experience. Welltower owns interests in properties concentrated in major, high-growth markets in the United States, Canada and the United Kingdom, consisting of seniors housing and post-acute communities and outpatient medical properties.