caretrust reit secures $500 million term loan facility

CareTrust REIT, Inc. (NYSE:CTRE), a healthcare REIT with a market capitalization of $5.5 billion and a "GREAT" financial health rating according to InvestingPro, has entered into a significant financial agreement, as detailed in a recent SEC filing. The company, which maintains impressive gross profit margins above 94%, along with its subsidiaries, has executed a first amendment to its credit and guaranty agreement with KeyBank National Association. This amendment introduces a new unsecured term loan facility valued at $500 million, in addition to the existing $1.2 billion unsecured revolving credit facility.

The term loan facility, which matures on May 30, 2030, is expected to be utilized to pay off an existing revolver balance of approximately $475 million, as well as to fund acquisitions and for general corporate purposes. This move aligns with CareTrust’s prudent debt management strategy, reflected in its moderate debt-to-equity ratio of 0.28 and strong current ratio of 7.07, indicating robust liquidity. The interest rates for loans under this facility are based on either a base rate plus a margin ranging from 0.10% to 0.80% per annum or Term SOFR or Daily Simple SOFR plus a margin between 1.10% and 1.80% per annum. These rates are contingent on the company’s debt to asset value ratio and may decrease if the company achieves certain investment-grade ratings.

The facility allows for prepayment without penalty, although lenders are entitled to reimbursement for any Term SOFR breakage costs. The agreement includes the same restrictive covenants and financial maintenance requirements as the revolving credit facility.

CareTrust REIT and its wholly owned subsidiaries guarantee the term loan facility, which is not subject to interim amortization before its maturity date. This financial arrangement reflects CareTrust’s strategic financial management and its efforts to optimize capital structure. InvestingPro analysis reveals the company’s strong financial position, with cash flows sufficiently covering interest payments. For deeper insights into CareTrust’s financial health and detailed metrics, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

This information is based on a press release statement filed with the SEC.

In other recent news, CareTrust REIT reported strong financial results for the first quarter of 2025, surpassing revenue expectations with $96.62 million compared to the forecasted $69.63 million. The company met its earnings per share forecast of $0.35, highlighting effective strategic acquisitions and operational efficiency. Additionally, CareTrust has secured a $500 million term loan to further support its growth initiatives, including acquisitions and general corporate purposes. The company also expanded its leadership team with the addition of two senior vice presidents. In a significant expansion move, CareTrust acquired 10 skilled nursing facilities across Idaho, Oregon, and Washington for approximately $146 million. Analysts have taken note of these developments, with Fitch Ratings upgrading CareTrust’s ratings to ’BBB-’ following its acquisition of UK-based Care REIT, enhancing the company’s diversification. Moody’s has also revised the outlook for CareTrust to positive, reflecting strong operational performance and credit metrics. These strategic moves indicate CareTrust’s ongoing efforts to expand and diversify its healthcare real estate portfolio.

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