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Senior Housing Properties (SNH) Gains But Lags Market: What You Should Know

Zacks Equity Research

In the latest trading session, Senior Housing Properties (SNH) closed at $11.80, marking a +0.25% move from the previous day. This move lagged the S&P 500's daily gain of 0.67%. Elsewhere, the Dow gained 0.82%, while the tech-heavy Nasdaq added 0.78%.

Heading into today, shares of the residential care real estate investment trust had lost 9.11% over the past month, lagging the Finance sector's loss of 1.59% and the S&P 500's gain of 1.25% in that time.

Wall Street will be looking for positivity from SNH as it approaches its next earnings report date. On that day, SNH is projected to report earnings of $0.44 per share, which would represent a year-over-year decline of 2.22%. Meanwhile, our latest consensus estimate is calling for revenue of $278.24 million, up 0.88% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.66 per share and revenue of $1.11 billion. These totals would mark changes of +4.4% and -0.71%, respectively, from last year.

Any recent changes to analyst estimates for SNH should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 2.01% lower. SNH is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, SNH is currently trading at a Forward P/E ratio of 7.09. This represents a discount compared to its industry's average Forward P/E of 15.39.

We can also see that SNH currently has a PEG ratio of 3.46. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. SNH's industry had an average PEG ratio of 2.84 as of yesterday's close.

The REIT and Equity Trust - Other industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 155, which puts it in the bottom 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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