Core Insights - CareTrust REIT (CTRE) has started 2026 strongly, continuing the impressive performance from 2025 with over 50% gains [1] Company Overview - CareTrust REIT operates with a capital structure that utilizes only 3% debt, indicating a conservative financial approach [1] Investment Strategy - The investment approach focuses on fundamental long-term perspectives, particularly in REITs, preferred stocks, and high-yield bonds [1]

Group 1 - The article does not provide any specific content related to company or industry analysis [1]

Core Viewpoint - Soros Fund Management made significant adjustments to its investment portfolio in the fourth quarter, focusing on increasing exposure to tech giants while engaging in "buy high, sell low" strategies for energy and cryptocurrency stocks [1]. Group 1: Technology Sector Investments - The fund substantially increased its holdings in core technology stocks, including adding 161,000 shares of Microsoft (MSFT.US), 118,000 shares of Nvidia (NVDA.US), and approximately 66,000 shares of Apple [3]. - In the software and mobility sectors, the fund also increased its positions by acquiring approximately 216,000 shares of Atlassian (TEAM.US), 55,000 shares of Salesforce (CRM.US), and 119,000 shares of Uber (UBER.US) [3]. Group 2: Defensive and Growth Investments - In the defensive sector and consumer space, the fund increased its holdings in utility company Exelon (EXC.US) by approximately 488,000 shares and in gaming giant Electronic Arts (EA.US) by about 318,000 shares [3]. Group 3: Reduction in High Volatility and Financial Stocks - The fund reduced its positions in high-volatility and financial stocks, significantly cutting approximately 168,000 shares of Snowflake (SNOW.US) [4]. - It also reduced its holdings in Circle Internet Group (CRCL.US) by about 151,000 shares and in Interactive Brokers (IBKR.US) by approximately 813,000 shares, indicating a cautious stance towards the financial brokerage sector [5][6]. Group 4: New Positions and Exits - The fund opened new positions by purchasing gold-related assets such as New Gold (NGD.US) and established positions in DigitalBridge (DBRG.US), Blue Owl Capital (OWL.US), Exact Sciences (EXAS.US), and Xcel Energy (XEL.US) [7]. - It completely exited positions in KeyCorp (KEY.US), CareTrust REIT (CTRE.US), Cipher Mining (CIFR.US), and KKR & Co. (KKR.US), indicating a shift away from traditional banking and certain cryptocurrency mining stocks towards more stable or defensive sectors [7]. Group 5: Overall Strategy - The overall strategy of Soros Fund Management in the fourth quarter reflects a clear approach: embracing AI and core tech assets like Microsoft and Nvidia while avoiding high-volatility cloud and data companies like Snowflake, and hedging against macroeconomic uncertainties by investing in gold stocks. This "pick and choose" adjustment strategy highlights the pursuit of certainty and safety margins amid global economic uncertainties [7].

Beyond FFO, we have increased the diversification of our portfolio across geography, asset type, operator, borrower, manager, and payer source, as well as achieving continual improvement in our already strong EBITDAR rent coverage. We ended the year having again grown our market cap by 61% to $8.2 billion. I cannot help but take a moment to thank our shareholders, our board, our operators, our capital and strategic partners, and our entire team for their dedication and hard work. We simply could not have pr ...

Sedgwick added that CareTrust ended the year with market capitalization growth of 61% to $8.2 billion , and cited an approximate 439% total shareholder return over the ten years through year-end.CareTrust reported total investments of $1.8 billion during 2025, which management said surpassed the company’s prior record set in 2024. Sedgwick said the investment activity supported 17.3% year-over-year normalized FFO per share growth. He also emphasized increasing diversification across geography, asset type, o ...

Financial Data and Key Metrics Changes - For Q4 2025, normalized FFO increased by 42.7% quarter-over-quarter to $104.1 million, while normalized FAD rose by 38.7% to $103 million [15] - On a per-share basis, normalized FFO increased by $0.07, or 17.5%, to $0.47 per share, and normalized FAD increased by $0.05, or 12.2%, to $0.46 per share [15] - For the full year, normalized FFO per share increased by $0.26, or 17.3%, to $1.76 per share, and normalized FAD increased by $0.22, or 14.3%, to $1.76 per share [15] Business Line Data and Key Metrics Changes - In Q4, the company completed approximately $562 million of investments, including its first SHOP deal involving three communities in Texas with 270 assisted living and memory care units [11] - The blended stabilized yield on Q4 investments was 8.8% [11] - Since year-end, the company closed on approximately $215 million of investments, including six skilled nursing facilities and two care homes in the UK [12] Market Data and Key Metrics Changes - The investment pipeline remains strong at approximately $500 million, with about half in UK Care Homes, a third in skilled nursing, and the remainder in a small SHOP deal and loans [13] - The company noted increased competition in the SHOP sector, with cap rates compressing as investors seek exposure to operating trends [13][34] Company Strategy and Development Direction - The company aims to be a unique healthcare REIT focused on disciplined investments in assets and operators that can significantly impact senior housing and care [10] - The strategic push into the UK Care Homes and SHOP sectors is expected to drive sustainable growth across skilled nursing, senior housing, and UK Care Home sectors [14] - The company plans to maintain a strong focus on long-term operator partnerships and creative transaction structuring [14] Management's Comments on Operating Environment and Future Outlook - The skilled nursing operating environment is currently stable and supportive across most states, with operators eager to return to growth mode [9] - The company anticipates a substantial year of external growth in 2026, supported by a deeper and more capable team [10] - Management expressed confidence in achieving another substantial year, given the current market conditions and the company's capabilities [42] Other Important Information - The company sold 6.5 million shares on a forward basis at an average price of $37.30, generating gross proceeds of approximately $242.5 million [16] - Initial guidance for fiscal year 2026 is for normalized FFO per share of $1.90-$1.95, representing a year-over-year increase of 9.4% [17] Q&A Session Summary Question: Guidance and expectations for the pipeline going forward - Management indicated that they are seeing consistent inbound interest in SHOP deals and are evaluating both large and small opportunities [22] Question: Sustainability of coverage levels in skilled nursing facilities - Management believes the skilled nursing environment is in a good place, with improved labor conditions and regulatory support [24] Question: Focus of data analytic hires - The data science team is primarily focused on building out SHOP capabilities but will impact the entire organization [29] Question: Details on the investment pipeline - The pipeline consists of approximately half UK Care Homes, a third US skilled nursing, and the remainder in SHOP and loans [33] Question: Competitive landscape in property types - SHOP is currently the most competitive segment, with significant capital pursuing deals [34] Question: Future funding strategies - Management plans to maintain a balance between equity and debt financing, depending on market conditions [58]

Financial Data and Key Metrics Changes - For Q4 2025, normalized FFO increased 42.7% over the prior quarter to $104.1 million, and normalized FAD increased 38.7% to $103 million [16] - On a per-share basis, normalized FFO increased $0.07, or 17.5%, to $0.47 per share, and normalized FAD increased $0.05, or 12.2%, to $0.46 per share [16] - For the full year, normalized FFO per share increased $0.26, or 17.3%, to $1.76 per share, and normalized FAD increased $0.22, or 14.3%, to $1.76 per share [16] Business Line Data and Key Metrics Changes - In Q4, approximately $562 million of investments were completed, including the first SHOP deal involving three communities in Texas with 270 assisted living and memory care units [12] - The blended stabilized yield on Q4 investments was 8.8% [12] - Since year-end, another approximately $215 million of investments were closed, including 6 skilled nursing facilities and 2 care homes in the UK [13] Market Data and Key Metrics Changes - The investment pipeline remains strong at approximately $500 million, with about half in UK care homes, a third in skilled nursing, and the remainder in a small SHOP deal and loans [14] - The competition in the SHOP segment is noted to be the most intense, with cap rates compressing as investors seek exposure to operating trends [14][35] Company Strategy and Development Direction - The company aims to be a unique healthcare REIT focused on disciplined investments in assets and operators that can significantly impact senior housing and care [11] - The strategic push into the UK care home market and the expansion of SHOP capabilities are key growth engines for the company [10][15] - The company is committed to maintaining a strong balance sheet while pursuing external growth opportunities [19][60] Management's Comments on Operating Environment and Future Outlook - The skilled nursing operating environment is described as stable and supportive, with operators eager to return to growth mode [9][25] - Management expresses confidence in achieving substantial growth in 2026, supported by a deeper and more capable team and new market opportunities [10][42] - The company anticipates a year-over-year increase in normalized FFO per share guidance for fiscal year 2026 of $1.90-$1.95, representing a 9.4% increase [18] Other Important Information - The company sold 6.5 million shares on a forward basis at an average price of $37.30, generating gross proceeds of approximately $242.5 million [17] - The company maintains low leverage with net debt to EBITDA of 0.7 times and a fixed charge coverage ratio of 10.5 times as of year-end [19] Q&A Session Summary Question: Guidance and expectations for the pipeline going forward - Management indicated that they are seeing consistent inbound interest in SHOP deals and are evaluating both large and small opportunities [22][23] Question: Sustainability of coverage levels in skilled nursing facilities - Management believes the skilled nursing environment is currently strong, with operators ready to grow and occupancy levels providing room for improvement [25] Question: Focus of data analytic hires - The data science team is primarily focused on enhancing SHOP capabilities but will impact the entire organization [30] Question: Details on the investment pipeline - The pipeline consists of approximately half UK care homes, a third US skilled nursing, and a mix of SHOP and other deals [34] Question: Competitive landscape in property types - SHOP is noted as the most competitive segment, with significant capital pursuing deals [35] Question: Future funding strategies - Management plans to balance between equity issuances and utilizing balance sheet capacity as opportunities arise [59]

Financial Data and Key Metrics Changes - For Q4 2025, normalized FFO increased by 42.7% over the prior quarter to $104.1 million, while normalized FAD increased by 38.7% to $103 million [15] - On a per-share basis, normalized FFO increased by $0.07, or 17.5%, to $0.47 per share, and normalized FAD increased by $0.05, or 12.2%, to $0.46 per share [15] - For the full year, normalized FFO per share increased by $0.26, or 17.3%, to $1.76 per share, and normalized FAD increased by $0.22, or 14.3%, to $1.76 per share [15] Business Line Data and Key Metrics Changes - In Q4, the company completed approximately $562 million of investments, including its first SHOP deal, which involved three communities in Texas totaling 270 assisted living and memory care units [11] - The blended stabilized yield on Q4 investments was 8.8% [11] - Since year-end, the company has closed on approximately $215 million of investments, including six skilled nursing facilities and two care homes in the UK [12] Market Data and Key Metrics Changes - The investment pipeline remains strong at approximately $500 million, with about half in UK care homes, a third in skilled nursing, and the remainder in a combination of SHOP deals and loans [12][35] - The skilled nursing operating environment is stable and largely supportive across most states, with the senior housing environment in both the U.S. and U.K. also stable and gaining strength [8] Company Strategy and Development Direction - The company aims to be a unique healthcare REIT focused on disciplined investments in assets and operators that can significantly impact senior housing and care [10] - The company has doubled its team and added capabilities in areas like tax and data science to support long-term growth [6] - The strategic push into the UK care home market and the SHOP segment is seen as a significant growth opportunity [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the skilled nursing environment, noting improvements in labor conditions and regulatory frameworks [25] - The company anticipates a substantial year of external growth, supported by a strong balance sheet and access to capital [9][19] - Initial guidance for fiscal year 2026 indicates normalized FFO per share of $1.90-$1.95, representing a year-over-year increase of 9.4% [17] Other Important Information - The company sold 6.5 million shares on a forward basis at an average price of $37.30, generating gross proceeds of approximately $242.5 million [16] - The company maintains low leverage with net debt to EBITDA of 0.7 times and a fixed charge coverage ratio of 10.5 times [19] Q&A Session Summary Question: Guidance and expectations for the pipeline going forward - Management indicated that they are seeing consistent inbound interest in SHOP deals and are open to both large and small opportunities [22][23] Question: Sustainability of coverage levels in skilled nursing facilities - Management believes the skilled nursing environment is strong, with operators eager to grow and occupancy levels providing room for improvement [25][26] Question: Focus of data analytic hires - The data science team is primarily focused on enhancing SHOP capabilities but will impact the entire organization [31] Question: Details on the investment pipeline - The pipeline consists of approximately half UK care homes, a third US skilled nursing, and the remainder in SHOP and loans [35] Question: Competitive landscape in property types - SHOP is noted as the most competitive segment, with significant capital pursuing deals [36] Question: Future funding strategies - Management plans to balance between equity issuances and utilizing balance sheet capacity as opportunities arise [60][61] Question: Underwriting criteria within SHOP - The company continues to seek low double-digit IRR and evaluates each deal's path to achieving that, despite cap rate compression [59]

Financial Performance - For the full year 2025, CareTrust reported net income of $320.5 million, or $1.57 per diluted weighted-average common share, a 96% increase from the prior year[3]. - Normalized FFO for 2025 was $359.7 million, or $1.76 per diluted weighted-average common share, reflecting a 17% increase year-over-year[3]. - For the fourth quarter, net income was $111.3 million, or $0.50 per diluted weighted-average common share, a 72% increase from the prior year quarter[3]. - Net income attributable to CareTrust REIT, Inc. for the twelve months ended December 31, 2025, was $320.5 million, compared to $125.1 million in 2024, representing a 156% increase[15]. - Earnings per common share attributable to CareTrust REIT, Inc. for the three months ended December 31, 2025, was $0.50, up from $0.29 in the same period of 2024[15]. - Net income attributable to CareTrust REIT, Inc. for Q4 2025 was $111.29 million, a significant increase from $52.14 million in Q4 2024, representing a growth of 113%[25]. - Total revenues for Q4 2025 reached $134.86 million, up from $86.94 million in Q4 2024, marking a year-over-year increase of 55%[27]. - Total revenues for the three months ended December 31, 2025, increased to $134.9 million, up 55% from $86.9 million in the same period of 2024[15]. Dividends and Payouts - CareTrust maintained a quarterly dividend of $0.335 per share, with a payout ratio of approximately 73% based on fourth quarter 2025 Normalized FAD[6]. - The company declared dividends of $0.335 per common share for the three months ended December 31, 2025, compared to $0.290 in the same period of 2024[15]. Investment and Growth - The company closed $1.8 billion of investment activity at a blended stabilized yield of 8.6% for the year[3]. - CareTrust's investment pipeline stands at $500 million, indicating strong growth potential[5]. - The company plans to continue expanding its real estate investments and has allocated significant capital for acquisitions in the upcoming year[39]. Debt and Financial Position - As of quarter end, CareTrust reported a Net Debt-to-Annualized Normalized Run Rate EBITDA of 0.7x, significantly below the target leverage range of 4.0x to 5.0x[4]. - The company has approximately $100 million in cash on hand and $372.0 million of gross proceeds pending from unsettled forward equity contracts[4]. - The company reported a net debt of $322.7 million as of December 31, 2025, with a net debt to annualized normalized run rate EBITDA ratio of 0.7x, compared to 0.5x in 2024[18]. - Senior unsecured notes payable totaled $397,816,000 as of December 31, 2025, with a fixed interest rate of 3.875% maturing in 2028[37]. - The total liabilities increased to $1,089,468,000 as of December 31, 2025, from $507,633,000 in 2024, indicating a rise of approximately 114%[33]. Future Projections - The company projects 2026 net income attributable to CareTrust of approximately $1.45 to $1.50 per share, Normalized FFO of approximately $1.90 to $1.95 per share, representing a 9.4% increase over 2025 results[5]. - Net income attributable to CareTrust REIT, Inc. ranged from $326 million to $338 million, with a per share estimate of $1.45 to $1.50[40]. - Funds from Operations (FFO) were projected between $427 million and $439 million, translating to a per share estimate of $1.90 to $1.95[40]. - Funds Available for Distribution (FAD) is expected to be between $428 million and $440 million, also with a per share estimate of $1.90 to $1.95[40]. - Cash rental revenue guidance is set at $430 million to $436 million[41]. - Interest income is projected to be between $88 million and $92 million[41]. - General and administrative expenses are expected to be in the range of $57 million to $59 million[41]. - Interest expense is anticipated to be between $45 million and $46 million[41]. Operational Metrics - The company achieved 100% collection of contractual rent and interest, excluding properties sold during the quarter[3]. - Normalized EBITDA attributable to CareTrust REIT, Inc. for the three months ended December 31, 2025, was $120.2 million, a 33% increase from $90.2 million in the same period of 2024[16]. - Normalized FFO attributable to CareTrust REIT, Inc. was $104.09 million for the year ended December 31, 2025, compared to $77.85 million in 2024, reflecting a growth of 33.9%[30]. - Real estate investments, net, increased to $3,709,576,000 as of December 31, 2025, from $2,226,740,000 in 2024, marking a growth of approximately 66.7%[33]. - Cash flows from operating activities for the year ended December 31, 2025, were $394,029,000, an increase from $244,251,000 in 2024[35]. Expenses and Impairments - Total expenses for the twelve months ended December 31, 2025, were $206.5 million, compared to $178.1 million in 2024, reflecting a 16% increase[15]. - The company’s interest expense for the twelve months ended December 31, 2025, was $43.7 million, an increase from $30.3 million in 2024[15]. - The impairment of real estate investments for the three months ended December 31, 2025, was $2.0 million, down from $5.4 million in the same period of 2024[15]. - Impairment of real estate investments was reported at $2.03 million for Q4 2025, down from $5.35 million in Q4 2024, showing a decrease of 62%[25]. - The company incurred non-routine transaction costs of $3.82 million in Q4 2025, compared to $1.33 million in Q4 2024, indicating an increase of 187%[25].

Portfolio Overview - As of December 31, 2025, the portfolio included 366 Skilled Nursing Facilities (SNFs) and 208 senior housing communities, with a total of 37,898 operational beds[45]. - The portfolio included 131 U.K. Care Homes, 54 Assisted Living Communities, and 12 Independent Living Communities as of December 31, 2025[50]. - The company has a total of 37,898 beds/units across its properties as of December 31, 2025, up from 28,088 in 2024, indicating a growth in capacity[58]. Industry Trends - The nursing home industry saw a decline from over 15,600 facilities in July 2016 to approximately 14,742 facilities in July 2025, indicating a widening supply and demand imbalance[44]. - The U.S. Census estimates that the population over 65 years old will nearly double from 2020 to 2060, supporting increased demand for skilled nursing and senior housing services[44]. - Projected expenditures for nursing home care facilities and continuing care retirement are expected to grow from approximately $228.8 billion in 2024 to approximately $385.9 billion in 2033[44]. Revenue and Financial Performance - Total revenue for the year ended December 31, 2025, was $369,419,000, a significant increase from $228,261,000 in 2024, representing a growth of approximately 62%[66]. - Skilled nursing triple-net properties generated revenue of $275,077,000, accounting for 74% occupancy, while senior housing triple-net properties generated $93,117,000 with 86% occupancy as of December 31, 2025[58]. - Annualized contractual rental income from the Original Ensign Leases was $79.6 million, representing 19% of total annualized contractual rental income as of December 31, 2025[48]. - The Ensign Master Leases generated annualized contractual rental income of $92.1 million, accounting for 23% of total annualized contractual rental income[48]. Geographic Concentration - The company has a geographically diverse portfolio with concentrations in California, the U.K., Texas, and Tennessee based on revenue[46]. - California accounted for 25% of total revenue in 2025, while Texas contributed 13%, indicating a geographic concentration in revenue generation[66]. Tenant Management and Creditworthiness - The company monitors tenant creditworthiness through lease coverage ratios, evaluating tenants' ability to meet their financial obligations[51]. - Ensign, the primary tenant, accounted for 23% of total annualized contractual rental income as of December 31, 2025, highlighting the financial stability of the tenant[73]. Capital Structure and Financing - Sold approximately 12.6 million shares at an average gross price of $29.34, generating gross proceeds of approximately $369.9 million under the ATM Program to fund acquisitions[75]. - Completed an underwritten public offering of 23.0 million newly issued shares at a price per share of $32.00, resulting in gross proceeds of $736.0 million to pay down debt and fund acquisitions[75]. - As of December 31, 2025, the company had $500.0 million in term loans and $400.0 million in notes payable, with $500.0 million of outstanding variable rate indebtedness[384]. - The unused portion of the Third Amended Credit Facility was $1.2 billion as of December 31, 2025, which is subject to variable rates if drawn upon[384]. Interest Rate and Financial Risks - The weighted average contractual principal balance for mortgage loans was $740,202,000 with an interest rate of 8.8%, generating interest income of $59,680,000 in 2025[64]. - An increase in interest rates could raise the costs of variable rate debt obligations and limit refinancing options, potentially increasing interest expenses[385]. - The company manages interest rate risks through interest rate swap agreements, although REIT provisions limit effective hedging capabilities[386]. Regulatory and Compliance Challenges - The company anticipates ongoing regulatory pressures in the healthcare industry, which may impact operations and financial conditions[112][113]. - Changes in reimbursement methodologies by federal and state authorities could negatively affect revenue levels for tenants and borrowers[117]. - The company is subject to complex healthcare laws and regulations, which may lead to civil, criminal, and administrative sanctions for non-compliance[114][115]. - Legislative changes and healthcare reform initiatives may impact the financial stability of tenants and borrowers, affecting their obligations to CareTrust[120][119]. Employee and Operational Insights - Employee satisfaction survey conducted with a 100% response rate and an overall satisfaction rate of 93%[106]. - CareTrust employs 43 full-time employees as of December 31, 2025, with no turnover except for one retirement[108][109]. - The company offers a comprehensive benefits package, including a 401(k) plan with a fixed employer contribution and various voluntary benefits[107]. - CareTrust's training and education initiatives support continuous learning and professional development for employees[111]. Sustainability and ESG Initiatives - Allocated up to $500,000 annually for the Tenant ESG Program to incentivize sustainable improvements at properties[102]. - Achieved 34% of leases including sustainability-related provisions by the fourth quarter of 2024[97]. - Enhanced climate risk management through tenant communications and physical climate risk assessments, identifying significant risks such as heat exposure[98]. Strategic Growth and Diversification - The company intends to diversify its asset portfolio by potentially expanding investments into behavioral health facilities and medical office buildings[68]. - Established a SHOP platform in Q4 2025, investing in three senior housing communities, which allows for direct exposure to property-level performance[72]. - Diversified business through opportunistic acquisitions and property upgrades, focusing on skilled nursing facilities and senior housing communities[85].