Diversified Healthcare Trust (NASDAQ:DHC) Shares Gap Down on Disappointing Earnings

Key Points

• Diversified Healthcare Trust shares gapped down after the REIT reported quarterly EPS of negative $0.21, missing the $0.15-loss consensus estimate, while revenue of $367.67 million also fell short of expectations.
• The company declared a quarterly dividend of $0.01, equivalent to $0.04 annually and a 0.5% yield; its payout ratio remains negative at -3.60%.
• Analyst sentiment is mixed, with a consensus rating of “Moderate Buy” and a $9.83 price target. Institutional investors own approximately 75.98% of the stock, including increased stakes from Bank of America and Dimensional Fund Advisors.

Diversified Healthcare Trust (NASDAQ:DHC - Get Free Report) gapped down prior to trading on Tuesday following a weaker than expected earnings announcement. The stock had previously closed at $7.74, but opened at $7.09. Diversified Healthcare Trust shares last traded at $7.5350, with a volume of 194,085 shares trading hands.

The real estate investment trust reported ($0.21) EPS for the quarter, missing the consensus estimate of ($0.15) by ($0.06). The firm had revenue of $367.67 million during the quarter, compared to analyst estimates of $370.87 million. Diversified Healthcare Trust had a negative return on equity of 16.22% and a negative net margin of 17.73%.

Diversified Healthcare Trust Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Thursday, November 12th. Investors of record on Monday, October 19th will be given a $0.01 dividend. This represents a $0.04 annualized dividend and a dividend yield of 0.5%. The ex-dividend date is Monday, October 19th. Diversified Healthcare Trust's dividend payout ratio is -3.60%.

Analyst Ratings Changes

DHC has been the topic of several recent analyst reports. Wall Street Zen raised shares of Diversified Healthcare Trust from a "sell" rating to a "hold" rating in a research note on Saturday, August 8th. Weiss Ratings reiterated a "sell (d-)" rating on shares of Diversified Healthcare Trust in a report on Thursday, October 15th. One investment analyst has rated the stock with a Strong Buy rating, two have assigned a Buy rating, two have issued a Hold rating and one has issued a Sell rating to the company's stock. According to MarketBeat.com, the company has an average rating of "Moderate Buy" and a consensus target price of $9.83.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently added to or reduced their stakes in DHC. Dimensional Fund Advisors LP increased its position in Diversified Healthcare Trust by 6.1% in the 1st quarter. Dimensional Fund Advisors LP now owns 2,399,804 shares of the real estate investment trust's stock worth $15,935,000 after purchasing an additional 138,708 shares during the last quarter. Bank of America Corp DE lifted its stake in shares of Diversified Healthcare Trust by 90.4% in the first quarter. Bank of America Corp DE now owns 2,682,265 shares of the real estate investment trust's stock worth $17,810,000 after buying an additional 1,273,681 shares during the last quarter. Engineers Gate Manager LP lifted its position in Diversified Healthcare Trust by 432.1% during the 2nd quarter. Engineers Gate Manager LP now owns 175,660 shares of the real estate investment trust's stock worth $1,634,000 after acquiring an additional 142,648 shares during the last quarter. Amundi bought a new stake in Diversified Healthcare Trust during the 1st quarter valued at approximately $847,000. Finally, Militia Capital Management LLC bought a new stake in shares of Diversified Healthcare Trust in the first quarter valued at approximately $1,422,000. 75.98% of the stock is owned by hedge funds and other institutional investors.

Diversified Healthcare Trust Trading Down 1.7%

The company has a current ratio of 4.66, a quick ratio of 4.67 and a debt-to-equity ratio of 1.52. The business's fifty day simple moving average is $7.76 and its two-hundred day simple moving average is $7.76. The stock has a market capitalization of $1.84 billion, a P/E ratio of -6.85 and a beta of 2.29.

Diversified Healthcare Trust Company Profile

Diversified Healthcare Trust NASDAQ: DHC is a real estate investment trust that owns and manages healthcare-related properties in the United States. Its portfolio includes medical office buildings, life science and research facilities, senior living communities, and wellness-oriented properties.

The trust leases its properties to healthcare providers, research organizations, senior living operators, and other related businesses. Its medical office and life science properties support outpatient care, medical research, and healthcare innovation, while its senior living portfolio serves older adults through independent living, assisted living, and related care services.

DHC was formerly known as Senior Housing Properties Trust and adopted its current name in 2020 to reflect its broader healthcare real estate strategy.

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