Wells upgrades Omega Healthcare to Overweight on improving portfolio metrics

As previously reported, Wells Fargo analyst Connor Siversky upgraded Omega Healthcare to Overweight from Equal Weight with a price target of $35, up from $31, on improving portfolio metrics that should drive rent coverage higher and reflect in NTM AFFO multiple valuations. Wells says 2024 guidance suggests the dividend will be covered in the back half of the year. Rent coverage improvements should be reinforced by the impact of rate increases that should reflect in Q1 numbers, and should justify a higher AFFO multiple vs. current levels, the firm adds. Maplewood remains a concern in Wells’ view, but is balanced by forthcoming resolutions related to Guardian and LaVie.