Healthcare Trust of America Inc (NYSE:HTA) is a real estate investment trust (REIT) that specializes in owning and operating medical office buildings and other healthcare assets in 33 states.
Its focus is on markets with long-term growth and the kind of infrastructure that can support servicing growing patient demand.
In the past year, HTA stock has ended up slightly underwater, losing 3.9% in that time. But its current 4.4% divided has kept it around breakeven, so now is the time to figure out if this is a good time to buy for the long-term, or look for another opportunity elsewhere in the sector.
If you’re looking for a solid long-term healthcare stock that will deliver both growth and a solid dividend, then now is the time to buy HTA stock.
First of all, HTA is REIT, which means you’re investing in an income stock with growth potential, not the other way around. And if that’s the case, then you have to think long-term for the dividend to have a chance to compound.
That means you have to take the long view when assessing HTA’s potential, both historically and moving forward.
Historically, HTA has outperformed the S&P 500 and the US REIT index since HTA’s launch in 2012. Given all the headlines about the S&P 500’s rally over that time and the bumpy ride REITs have had, that is an impressive performance.
The Future of HTA Stock
The past year isn’t par for the course. Much of its lackluster performance has been the lack of visibility regarding healthcare legislation. If the Street doesn’t know how healthcare legislation will play out, it can’t make investments on a forward-looking path.
That money then goes into other investments with better visibility.
But regardless of what happens to healthcare, the future is bright for HTA.
In its investor presentation, HTA highlights a couple compelling points.
First, at this point, 10,000 people in the U.S. are turning 65 every day. And that number will almost double by 2060. The population is getting older and older people require more healthcare support.
Second, healthcare expenditures are expected to double by 2025. If spending increases, then people will be forced to spend less on other goods and services. That becomes a very real economic challenge since consumer spending makes up a significant majority of U.S. growth.
If you want to trade in your car for a newer model but your healthcare expenses are costing you more and more, that car is going to have to wait.
If you’re an investor, this is no time to bemoan the fate of retailers. This is an opportunity to buy into a significant, ineluctable long-term trend.
Richard Band’s Profitable Investing advisory service helps retirement savers outperform the market without losing a minute of sleep along the way. His straightforward style and low-risk value approach has won seven Best Financial Advisory awards from the Newsletter and Electronic Publishers Foundation.