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Physicians Realty Trust: Wait For A Drop Before Buying This 5.0%-Yielding Top-Shelf Healthcare REIT

Published Sun, 10 Feb 2019 17:33:18 -0500 on Seeking Alpha

Healthcare REIT Physicians Realty Trust (DOC) is a high-quality income vehicle with potential to grow its dividend in the future. The company benefits from an aging U.S. population and rising healthcare expenditures, which sets the base for long-term FFO and dividend growth. Physicians Realty Trust easily covers its dividend with normalized funds from operations, but shares are overbought now and, as a result, a bit expensive. An investment in Physicians Realty Trust comes with an entry yield of ~5.0 percent.
Physicians Realty Trust - Portfolio Overview
Physicians Realty Trust is structured as an internally-managed healthcare REIT which means the company is required by law to distribute the majority of its earnings/taxable income as dividends to shareholders. Physicians Realty Trust is one of the nation's largest investors in medical office buildings, or MOBs. At the end of the September quarter, Physicians Realty Trust's real estate portfolio included 250 properties in 30 states, reflecting 13.5 million square feet.
Here's a portfolio snapshot.
Source: Physicians Realty Trust Investor Presentation
Physicians Realty Trust benefits from two major trends in the United States:
1. The U.S. population is aging rapidly and older age cohorts are expected to make up a considerably larger share of U.S. society in the next couple of decades;
Source: Physicians Realty Trust
2. Patients require cost-effective solutions to their health problems, which is... Read more