Q2 2026 CareTrust REIT Inc Earnings Call Transcript
Key Points
- Record investment quarter with approximately $900 million deployed at a blended yield of 8.9%, and year-to-date investments of $1.5 billion.
- Strong financial performance with normalized FFO and FAD per share up 19% year-over-year, and raised full-year 2026 guidance.
- Operators outperform industry averages in quality care metrics, including star ratings, health inspections, and readmission rates.
- Robust balance sheet with low leverage (net debt to EBITDA of 1.0x), ample liquidity of $1.4 billion, and no debt maturities before 2028.
- Diversified growth across three engines: U.S. skilled nursing, U.K. care homes, and SHOP, with a pipeline of $540 million and strong deal flow.
- SHOP acquisition pipeline is currently limited due to timing and discipline, with stiff competition and compressing cap rates in that space.
- Potential for tenant purchase options to be exercised, which could reduce the asset base, though considered likely.
- Guidance assumes no new investments or financing beyond year-to-date, indicating potential uncertainty in future deployment.
- U.K. care home portfolio deal required a slight premium due to scale, impacting pricing.
- Dependence on equity forward contracts and ATM program for funding, which may be affected by market conditions and Fed policy.
Hello, everyone. Thank you for joining us, and welcome to the CareTrust second-quarter earnings call. (Operator Instructions)
I will now hand the conference over to Lauren Beale, Chief Accounting Officer. Lauren, please go ahead.
Thank you, and welcome to CareTrust REIT's second-quarter 2026 earnings call.
Today, we will make forward-looking statements based on management's current expectations, including statements regarding future financial performance, dividends, acquisitions, investments, financing plans, business strategies, and growth prospects. These forward-looking statements are subject to risks and uncertainties that could cause actual results to materially differ from our expectations. These risks are discussed in CareTrust REIT's most recent Form 10-Q filing with the SEC. We do not undertake a duty to update or revise these statements, except as required by law.
During the call, the company will reference non-GAAP metrics, such as EBITDA, FFO, and FAD. A
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