Target Healthcare REITLSE:THRL -1.14%32 ROE % is 12.95% as of Dec. 2025, which is 67% above its 10-year median of 7.76. GuruFocus rates LSE:THRL with a GF Score™ of 32/100 and a GF Value™ of £0.89 (Modestly Overvalued). The stock has 7 warning signs investors should review. Among 933 REITs companies, Target Healthcare REIT ranks better than 76.63% on this metric.
ROE % measures the rate of return on the ownership interest (shareholder's equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net assets or assets minus liabilities). ROE % shows how well a company uses investment funds to generate earnings growth. ROE %s between 15% and 20% are considered desirable.
The factors that affect a company's ROE % can be illustrated with the three-step DuPont Analysis:
Note:
The net income data used here is two times the semi-annual (Dec. 2025) net income data. The Revenue data used here is two times the semi-annual (Dec. 2025) revenue data. The same rule applies to Pre-Tax Income and Operating Income.
* In the five-step DuPont Analysis, Operating Income is only available for non-financial companies. Thus, for Insurance companies, we use EBIT as a substitution of Operating Income. For Banks, both Operating Income and EBIT is unavailable. Thus we combined Interest Burden and Operating Margin % into Pretax Margin %, and the DuPont Analysis is divided into four components instead.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Be Aware
Net Income is used.
Because a company can increase its ROE % by having more financial leverage, it is important to watch the equity multiplier when investing in high ROE % companies. Like ROA %, ROE % is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their ROE %s can be extremely high.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the REIT - Healthcare Facilities subindustry, Target Healthcare REIT's ROE %, along with its competitors' market caps and ROE % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Target Healthcare REIT ROE % vs REITs Industry
For the REITs industry and Real Estate sector, Target Healthcare REIT's ROE % distribution charts can be found below:
* The bar in red indicates where Target Healthcare REIT's ROE % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual ROE %, the net income of the last fiscal year and the average total shareholder equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is two times the semi-annual (Dec. 2025) net income data.
ROE % is displayed in the 30-year financial page.
Target Healthcare REIT (LSE:THRL) has a ROE % of 12.95% as of Dec. 2025. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on Target Healthcare REIT and its competitors. This is 67% above median its historical median of 7.76. According to the industry distribution chart, Target Healthcare REIT ranks #218 out of 933 companies in the REITs industry, placing it in the top 23.4%.
Is Target Healthcare REIT's ROE % too high?
Target Healthcare REIT's current ROE % of 12.95% is 67% above median its 10-year median of 7.76. The REITs industry median ROE % is 6.20. Target Healthcare REIT's value of 12.95% is 108.9% above this industry median. Based on the distribution chart, Target Healthcare REIT ranks #218 out of 933 companies in the REITs industry, which is in the top quartile — a strong position relative to peers. Overall, Target Healthcare REIT has a GF Score™ of 32/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Target Healthcare REIT's ROE % compare to WELL and VTR?
According to the REITs industry distribution chart, Target Healthcare REIT ranks #218 out of 933 companies for ROE %. This places Target Healthcare REIT in the top 23% of its industry — outperforming the majority of peers. The industry median ROE % is 6.20. Target Healthcare REIT's value of 12.95% is 108.9% above this benchmark. While the company's 10-year median is 7.76 vs. the industry median of 6.20, Target Healthcare REIT has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROE % for a REITs company?
The median ROE % among REITs companies is 6.20, based on 933 companies in the industry. Companies in the top quartile (top 25%) have a ROE % significantly above this median, while those in the bottom quartile fall well below. However, ROE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Target Healthcare REIT's current ROE % of 12.95% is 108.9% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROE % mean?
A high ROE % can signal that a stock is expensive relative to its fundamentals. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on Target Healthcare REIT and its competitors. For the REITs industry, the median ROE % is 6.20 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Target Healthcare REIT's current ROE % is 12.95%, which is 67% above median its own 10-year median of 7.76. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Target Healthcare REIT stock overvalued right now?
Based on GuruFocus' analysis, Target Healthcare REIT (LSE:THRL) is currently considered Modestly Overvalued. The stock's GF Value™ is £0.89, compared to a current price of £1.04 — trading 16.9% above its estimated fair value. The current ROE % is 12.95%, which is 67% above median its 10-year median of 7.76 and 108.9% above the REITs industry median of 6.20. Target Healthcare REIT's overall GF Score™ is 32/100 with 7 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROE % calculated?
ROE % is calculated from a company's financial statements. For Target Healthcare REIT (LSE:THRL), the current ROE % is 12.95% as of Dec. 2025. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Target Healthcare REIT (LSE:THRL) Overvalued in 2026?
Based on GuruFocus' analysis, Target Healthcare REIT stock appears to be overvalued.
The current stock price of £1.04 is trading 16.9% above its estimated GF Value™ of £0.89.
GuruFocus considers Target Healthcare REIT to be Modestly Overvalued.
Key valuation signals for LSE:THRL:
ROE %: 12.95% (67% above median its 10-year median of 7.76)
GF Value™: £0.89 vs. price of £1.04 (16.9% above fair value)
Industry Position: 108.9% above the REITs median (#218 of 933)
No single metric tells the full story. See the LSE:THRL stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Target Healthcare REIT PLC is an investment company that acts as a long-term investor in care homes in the United Kingdom. The investment objective of the company is to provide shareholders with an attractive level of income together with the potential for capital and income growth from investing in a diversified portfolio of freehold and long-leasehold care homes, which are let to care home operators, and other healthcare assets in the United Kingdom.
32GF Score
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