Sabra Healthcare REIT stock price target raised to $22 at Citizens JMP

Investing.com - Citizens JMP raised its price target on Sabra Healthcare REIT Inc . (NASDAQ:SBRA) to $22.00 from $20.00 on Wednesday, while maintaining a Market Outperform rating on the healthcare real estate investment trust. The stock, currently trading at $18.18, shows promising potential according to InvestingPro analysis, which indicates the company is slightly undervalued based on its Fair Value assessment.

The price target increase follows Sabra’s second-quarter 2025 results, which showed Core FFO of $0.38 per share, exceeding both Citizens and consensus expectations of $0.37 and $0.36 per share, respectively. The outperformance was primarily attributed to higher net lease income related to percentage rents. InvestingPro data reveals strong financial health metrics, with a current ratio of 1.39 indicating solid liquidity and a healthy gross profit margin of 67.5%.

Following the quarterly results, Sabra’s management raised the midpoint of its Normalized FFO guidance by $0.01 and Normalized AFFO by half a penny. The company reported strong portfolio performance with coverage ratios expanding across all categories and same-store Senior Housing (NASDAQ:DHC) Operating Portfolio (SHOP) NOI growing by 17%.

Citizens JMP noted that Sabra is now focusing on external growth, with plans to expand its SHOP portfolio by $1 billion through the end of 2026. This expansion would increase the company’s exposure to SHOP assets from 20% to 30% of its portfolio.

The analyst firm based its new price target on 14 times 2026 estimated FFO, up from the previous multiple of 13 times, citing favorable timing for increasing exposure to SHOP assets given limited new supply and high demand from the baby boomer demographic. Notable for income investors, InvestingPro highlights that Sabra has maintained dividend payments for 15 consecutive years, currently offering a substantial 6.6% yield. For deeper insights into Sabra’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

In other recent news, Sabra Healthcare REIT Inc. reported its second-quarter 2025 earnings, significantly outperforming market expectations. The company achieved an earnings per share (EPS) of $0.27, surpassing the forecasted $0.18, which represents a 50% surprise. Revenue figures also exceeded predictions, reaching $189.15 million compared to the anticipated $181.53 million, marking a 4.2% surprise. These results highlight Sabra Healthcare REIT’s strong financial performance in the recent quarter. Despite these positive earnings and revenue results, the stock experienced a minor decline. Investors and analysts continue to monitor the company’s financial health and market performance closely.

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