HCP (HCP) is having an ugly year. The stock is off more than 12%, lagging the broader market by a dozen percentage points.
That’s partly due to the same forces afflicting many real estate investment trusts, like Health Care REIT mentioned above. These stocks had huge runs last year, and fears that the Federal Reserve could start tapering its bond-buying program spurred investors and traders to lock in profits.
Longer-term, the outlook is just fine for HCP. Like the competition, it’s active on the acquisition front, which loads up costs now for returns on capital later. It also operates in a sector that has tailwinds for the next 20 years or so, as the baby boomers enter their dotage.
In the shorter-term, HCP’s decent balance sheet and improved credit profile mean the dividends will keep coming.