Company Overview
Sabra Health Care REIT, Inc. operates as a self-administered, self-managed real estate investment trust that, through its subsidiaries, owns and invests in real estate serving the healthcare industry throughout the United States and Canada. Incorporated in Maryland, the company functions within the Real Estate sector, specifically the REIT - Healthcare Facilities industry, which implies a business model focused on owning properties such as senior housing and medical office buildings while adhering to specific regulatory structures. The company's scale is defined by a market capitalization of $4.94B and an annual revenue of $775.76M, supported by a workforce of 58 employees. These figures indicate that Sabra Health Care REIT, Inc. holds a significant position within its niche, commanding a substantial market value relative to its employee base, which suggests high asset intensity and operational leverage typical of large-scale healthcare real estate portfolios.
Financial Health
The company reports a Trailing Twelve Months revenue of $775.76M and a net income of $155.61M, while generating an EBITDA of $447.11M. The substantial gap between the revenue figure and the net income reveals a cost structure where approximately 80% of revenue is absorbed by operating expenses, taxes, and interest before arriving at the bottom line, a characteristic common in capital-intensive REIT models. Sabra Health Care REIT, Inc. produced a free cash flow of $320.53M, which provides the entity with significant financial flexibility to service its debt obligations, maintain properties, or pursue acquisitions without relying solely on external financing. The company maintains a gross margin of 65.2%, an operating margin of 23.7%, and a profit margin of 20.1%; these levels indicate strong pricing power and efficient property management, as the operating margin suggests that roughly 24 cents of every dollar of revenue remains after covering all direct operating costs. In terms of leverage, the company holds $74.92M in cash against $2.54B in debt, resulting in a debt-to-equity ratio of 89.86%, which indicates a highly leveraged balance sheet typical for REITs but one that requires consistent cash flow coverage. The current ratio stands at 1.80, indicating that the company possesses sufficient liquid assets to cover its short-term liabilities more than twice over, suggesting robust short-term liquidity management. Finally, the Return on Equity is 5.6% and the Return on Assets is 3.1%; these metrics reveal that management effectiveness in generating returns on shareholder capital is moderate, while the return on assets reflects the dilutive impact of the high debt load on overall profitability.
Valuation Assessment
Sabra Health Care REIT, Inc. trades with a P/E Ratio (TTM) of 30.64 and a Forward P/E of 24.98, implying that the market expects earnings growth to bridge the gap between current and forward multiples over the coming twelve months. The price-to-book ratio is 1.75, indicating that the market values the company at a 75% premium over its book value, which may reflect confidence in the quality of its healthcare real estate assets and future cash flow potential. Alternative valuation metrics show a price-to-sales ratio of 6.37 and an EV/EBITDA of 16.57; these figures suggest that the stock is priced on a multiple of sales that is elevated relative to typical REIT peers, while the EV/EBITDA multiple indicates a valuation that is somewhat compressed relative to its earnings before interest, taxes, depreciation, and amortization. The stock's 52-week high is $21.07 and the 52-week low is $15.75; without a specific current price provided in the source facts, the valuation range indicates a trading band where the asset has experienced volatility within this $5.32 spread over the past year. The beta is 0.64, meaning the stock's price volatility is approximately 36% lower than the broader market, suggesting it acts as a defensive holding that moves less dramatically than the S&P 500 during periods of market fluctuation.
Growth & Income
Sabra Health Care REIT, Inc. reported a revenue growth of 15.8% year over year, whereas earnings growth was -44.7% year over year. This divergence indicates that while top-line revenue is expanding rapidly, net income is contracting significantly, likely due to non-recurring charges, increased interest expenses from the high debt load, or adjustments in the operating structure that have not yet stabilized. As a dividend payer, the company offers a dividend yield of 6.1%, but it sustains this payout with a payout ratio of 187.5%, which is unsustainable given the negative earnings growth and implies that dividends are being funded by cash flow rather than current net income. The high payout ratio relative to earnings suggests that the company must rely heavily on its strong free cash flow generation to maintain the dividend, creating a risk if cash flows were to diminish. Overall, the company presents a profile of strong revenue expansion offset by significant earnings contraction, supported by a high-yield dividend that requires careful monitoring of the sustainability of its payout mechanics.