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NEW YORK - Glass Lewis has become the third independent proxy advisory firm to recommend that Brookdale Senior Living Inc. (NYSE:BKD) stockholders vote for nominees proposed by activist investor Ortelius Advisors, L.P., according to a press release statement. The $1.6 billion market cap senior living operator has been facing significant challenges, with InvestingPro data showing concerning metrics including substantial debt burden and negative earnings of -$1.04 per share over the last twelve months.
The recommendation follows similar support from Institutional Shareholder Services (ISS) and Egan-Jones Ratings Company ahead of Brookdale’s 2025 Annual Meeting of Stockholders.
In its report, Glass Lewis acknowledged Ortelius’ campaign to address Brookdale’s underperformance, noting that the company trails competitors and has a "moribund returns profile." The advisory firm credited Ortelius’ public pressure for driving recent changes at Brookdale, including the immediate termination of CEO Cindy Baier. Recent InvestingPro analysis reveals the company’s struggles with a concerning current ratio of 0.82 and a debt-to-capital ratio of 78%, suggesting significant financial stress. Get access to 8 more crucial ProTips and comprehensive analysis with an InvestingPro subscription.
Glass Lewis specifically endorsed Ortelius nominees Steven J. Insoft and Steven Vick, citing their "valuable senior housing and real estate expertise" as beneficial for Brookdale’s portfolio optimization efforts. The firm also recommended withholding votes for long-tenured Brookdale directors Lee Wielansky and Victoria Freed.
The proxy advisor validated several of Ortelius’ criticisms about Brookdale’s operations, including that more than a third of the company’s properties have occupancy rates below 75%. Glass Lewis also agreed with Ortelius’ assessment of Brookdale’s depressed net operating income margins and excessive leverage compared to industry peers.
Ortelius’ plan involves selling underperforming properties and exiting leased properties to create an optimized portfolio of high-quality communities. Glass Lewis described this approach as "well conceived and viable." According to InvestingPro data, despite these challenges, the company has shown some positive momentum with a 38% price return over the past six months, though current trading levels suggest the stock is slightly overvalued based on InvestingPro’s Fair Value analysis.
Peter DeSorcy, Managing Member of Ortelius, stated that the recommendations from three independent proxy advisors confirm the need for change at Brookdale and urged stockholders to vote for all six Ortelius nominees on the WHITE proxy card.
In other recent news, Brookdale Senior Living Inc. has reported an increase in occupancy rates for May 2025, with consolidated weighted average occupancy reaching 80.0%, marking a significant achievement. The company’s same community weighted average occupancy rose to 80.6%, and the month-end occupancy in May saw the highest sequential growth in nine months. Meanwhile, proxy advisory firm Egan-Jones has recommended Brookdale stockholders vote for all six director nominees proposed by activist investor Ortelius Advisors in the upcoming annual meeting. Egan-Jones expressed concerns over Brookdale’s high debt levels and financial underperformance, suggesting asset sales as a potential solution.
Institutional Shareholder Services (ISS) has taken a different stance, recommending support for most of Brookdale’s board nominees while questioning the feasibility of Ortelius’ plan. Brookdale has urged shareholders to back its current board, emphasizing the qualifications of its nominees and recent performance improvements, such as positive adjusted free cash flow. The company has also highlighted its board’s role in strategy execution and the ongoing CEO search process. Ortelius Advisors, on the other hand, has filed proxy materials advocating for a board overhaul, citing longstanding governance issues and the need for leadership change to maximize shareholder value. As the annual meeting approaches, shareholders face a critical decision regarding the company’s governance structure.
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