Healthcare Realty Trust Incorporated (HR) Fund Overview

Healthcare Realty Trust Incorporated (HR) Real Estate Portfolio & Strategy

Healthcare Realty Trust is a REIT specializing in outpatient healthcare properties across the United States. With a portfolio of 211 properties and a focus on leasing and property management, the company operates in the healthcare real estate sector, offering income-producing assets and related services.

What Is the Investment Thesis for HR?

The increasing demand for outpatient services, driven by cost efficiencies and patient convenience, supports the long-term growth potential of the company's portfolio. With a dividend yield of 5.11%, HR offers an attractive income stream for investors. However, the company's negative profit margin of -17.3% and gross margin of -8.6% warrant careful consideration. Key catalysts include strategic acquisitions and developments that expand the company's footprint and enhance its portfolio quality. The company's beta of 0.80 suggests lower volatility compared to the broader market. Investors should monitor the company's ability to improve its financial performance and capitalize on the favorable trends in the outpatient healthcare market.

Based on FMP financials and quantitative analysis

HR Key Highlights

As of September 30, 2020, Healthcare Realty Trust owned 211 real estate properties in 24 states.

• The total square footage of owned properties was 15.5 million square feet as of September 30, 2020.
• The company's real estate properties were valued at approximately $5.5 billion as of September 30, 2020.
• Healthcare Realty Trust provides leasing and property management services to 11.9 million square feet nationwide.
• The company's dividend yield is 5.11%.

Who Are HR's Competitors?

HR is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.

AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance

What Are HR's Key Strengths?

Specialized focus on outpatient healthcare properties.

• Integrated platform for owning, managing, and developing properties.
• Geographic diversification across 24 states.
• Established relationships with healthcare providers.

What Are HR's Weaknesses?

Negative profit margin (-17.3%).

• Negative gross margin (-8.6%).
• Reliance on the healthcare industry, which is subject to regulatory changes.
• Potential for tenant concentration risk.

What Could Drive HR Stock Higher?

Strategic acquisitions of outpatient healthcare properties to expand the company's portfolio.

• Development of new outpatient healthcare facilities in underserved markets.
• Enhanced property management services to improve tenant satisfaction and retention.
• Expansion into new geographic markets with favorable demographics and healthcare trends.

What Are the Key Risks for HR?

Financial-distress signal — its Altman Z-Score of 1.01 sits in the distress zone (elevated bankruptcy risk).

• Negative return on equity (-1.9%) — the business is not currently generating profit on shareholder capital.
• Inconsistent delivery — missed Wall Street EPS estimates in 7 of the last 8 reported quarters.
• Changes in healthcare regulations and reimbursement policies could impact tenant profitability.
• Economic downturns could lead to decreased tenant occupancy rates.
• Rising interest rates could increase borrowing costs and reduce profitability.
• Competition from other healthcare REITs could limit growth opportunities.
• Negative profit and gross margins may deter investors.

What Are the Growth Opportunities for HR?

• Strategic Acquisitions: Healthcare Realty Trust can expand its portfolio through strategic acquisitions of existing outpatient healthcare properties. The market for medical office buildings and outpatient surgery centers is fragmented, offering opportunities to consolidate assets and increase market share. By acquiring well-located and high-quality properties, the company can enhance its revenue stream and improve its overall portfolio performance. The timeline for acquisitions depends on market conditions and the availability of suitable properties, but ongoing efforts in this area could yield significant growth over the next 3-5 years.
• Development Projects: Developing new outpatient healthcare facilities can provide Healthcare Realty Trust with opportunities to create state-of-the-art properties tailored to the specific needs of healthcare providers. By identifying underserved markets and partnering with leading healthcare systems, the company can develop high-quality facilities that attract tenants and generate attractive returns. Development projects typically have a longer timeline, ranging from 2-3 years for planning and construction, but they can create long-term value and differentiate the company from its competitors.
• Enhanced Property Management Services: Healthcare Realty Trust can enhance its property management services to improve tenant satisfaction and retention. By offering a comprehensive suite of services, including leasing, maintenance, and capital improvements, the company can build strong relationships with its tenants and create a stable revenue stream. Investing in technology and training to improve the efficiency and effectiveness of its property management services can also enhance the company's competitive advantage. This is an ongoing opportunity with continuous improvement over the next 1-2 years.
• Expansion into New Markets: Healthcare Realty Trust can expand its geographic footprint by entering new markets with strong demand for outpatient healthcare services. By targeting regions with favorable demographics and healthcare trends, the company can diversify its portfolio and reduce its exposure to regional economic fluctuations. Conducting thorough market research and establishing partnerships with local healthcare providers can facilitate successful market entry. Expansion into new markets could occur gradually over the next 3-5 years.
• Leveraging Technology: Healthcare Realty Trust can leverage technology to improve its operational efficiency and enhance the tenant experience. Implementing advanced property management software, utilizing data analytics to optimize leasing and pricing strategies, and offering tenants digital tools for communication and service requests can create a more efficient and user-friendly environment. This ongoing initiative can provide a competitive edge and improve the company's financial performance within the next 1-2 years.

What Are HR's Competitive Advantages?

• Specialization in outpatient healthcare properties.
• Established relationships with healthcare providers.
• Geographic diversification across 24 states.
• Integrated platform for owning, managing, and developing properties.

What Does HR Do?

Healthcare Realty Trust Incorporated is a real estate investment trust (REIT) established to focus on income-producing real estate properties associated primarily with the delivery of outpatient healthcare services. The company integrates the ownership, management, financing, and development of these properties across the United States. Founded with the vision of capitalizing on the growing demand for outpatient healthcare facilities, Healthcare Realty Trust has evolved into a significant player in the healthcare REIT sector. As of September 30, 2020, the company owned 211 real estate properties located in 24 states, encompassing a total of 15.5 million square feet, with an approximate valuation of $5.5 billion. In addition to property ownership, Healthcare Realty Trust provides leasing and property management services for approximately 11.9 million square feet of healthcare properties nationwide. The company's strategic focus on outpatient facilities positions it to benefit from the increasing shift towards outpatient care, driven by cost efficiencies and patient preferences. Healthcare Realty Trust's portfolio includes medical office buildings, outpatient surgery centers, and other specialized healthcare facilities, catering to a diverse range of healthcare providers and services. The company is headquartered in Nashville, Tennessee, and operates with a team of 550 employees dedicated to managing and expanding its healthcare real estate portfolio.

What Products and Services Does HR Offer?

• Owns income-producing real estate properties.
• Manages healthcare-related real estate.
• Finances healthcare real estate ventures.
• Develops outpatient healthcare facilities.
• Leases properties to healthcare providers.
• Provides property management services nationwide.

How Does HR Make Money?

• Generates revenue through leasing properties to healthcare providers.
• Earns income from property management services.
• Increases asset value through strategic development and acquisitions.
• Finances operations through debt and equity offerings.

What Industry Does HR Operate In?

Healthcare Realty Trust operates within the REIT - Healthcare Facilities industry, which is experiencing growth due to the increasing demand for outpatient healthcare services. The aging population and advancements in medical technology are driving the shift towards outpatient care, creating opportunities for REITs specializing in healthcare properties. The competitive landscape includes other healthcare REITs such as American Healthcare REIT, Inc. (AHR) and CareTrust REIT, Inc. (CTRE), as well as diversified REITs with healthcare portfolios. Healthcare Realty Trust's focus on outpatient facilities positions it to capitalize on this trend, but it also faces competition from other players in the market.

Who Are HR's Key Customers?

• Hospitals and healthcare systems.
• Physician practices and medical groups.
• Outpatient surgery centers.
• Specialized healthcare providers (e.g., dialysis centers, rehabilitation facilities).

Over the past six months, Healthcare Realty Trust Incorporated insiders filed 8 SEC Form 4 transactions — 3 sales and 5 purchases. On net that is roughly 49K shares disposed (about $894K), a signal worth weighing alongside the fundamentals.

Healthcare Realty Trust Incorporated has missed Wall Street's EPS estimate in 7 of its last 8 reported quarters — a recurring pattern of falling short of estimates. Reported results have landed about 661.4% below estimates on average.

Healthcare Realty Trust Incorporated's Piotroski F-Score is 6/9, a 9-point checklist of profitability, leverage and efficiency — a middling fundamental profile. Its Altman Z-Score of 1.01 places it in the distress zone, a signal of elevated financial risk.

Return on equity for Healthcare Realty Trust Incorporated stands at -1.9%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is -1.0%, showing how much profit it generates from its asset base. Its free cash flow yield is 2.0%, a gauge of the cash the business throws off relative to its market value. A current ratio of 0.11 means current liabilities exceed short-term assets, a liquidity point worth watching. Its earnings yield is -1.3%, the inverse of the P/E and a quick read on earnings relative to price.

HR Revenue & Earnings Trend

In Q2 FY2026, HR generated $281.8M in top-line revenue, marking a sequential increase of 1.0%. The company recorded a net loss of $43.5M, with diluted EPS of $-0.13. Quarter-over-quarter revenue has been mixed, typical for a unknown company operating in Real Estate. Across the four most recent quarters, HR averaged $-0.07 in diluted EPS.

Company Profile

Healthcare Realty Trust Incorporated operates in the REIT - Healthcare Facilities industry within the Real Estate sector. It is headquartered in Nashville, US. The company is led by CEO Peter A. Scott. HR has traded publicly since 1993.

HR Financials

HR Latest News

HR Analyst Consensus

HR MoonshotScore

HR Real Estate Stock FAQ

Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

Official Resources