CTRE

CareTrust REIT, Inc. recently reported its second-quarter 2026 results, with revenue rising to US$161.35 million and net income reaching US$89 million, and it raised full-year 2026 net income guidance to US$356 million–US$364 million, or about US$1.53–US$1.56 per share. Management also highlighted nearly US$900 million of record second-quarter investment activity at an average yield of 8.9%, supporting stronger normalized FFO and FAD guidance and reflecting the impact of its multi-engine growth approach across skilled nursing, seniors housing, and international assets. We’ll now assess how CareTrust’s record US$900 million investment quarter and upgraded 2026 earnings guidance influence its existing investment narrative. Find 50 companies with promising cash flow potential yet trading below their fair value. To own CareTrust REIT, you need to believe in its ability to keep turning a bigger, more diversified healthcare portfolio into steady rent and cash flow without sacrificing quality or balance sheet strength. The record US$900 million of second quarter investments and higher 2026 net income guidance support the current growth story, but they also raise the importance of disciplined integration as the key near term catalyst and the biggest operational risk. If anything, this news makes that execution risk more visible, not less. Among recent announcements, the May 2026 follow on equity offering that raised about US$509.4 million is especially relevant, because it helped fund the accelerated investment activity behind the updated earnings guidance. For investors, the link between fresh equity capital, rapid deployment into skilled nursing, seniors housing and U.K. care homes, and management’s higher normalized FFO and FAD outlook is central to judging whether the current growth phase is creating long term value or simply adding complexity. Yet even with improving guidance, investors should be aware that rapid portfolio expansion and U.K. market entry could... Read the full narrative on CareTrust REIT (it's free!) CareTrust REIT's narrative projects $970.3 million revenue and $494.9 million earnings by 2029. This requires 22.9% yearly revenue growth and a $159.9 million earnings increase from $335.0 million. Uncover how CareTrust REIT's forecasts yield a $45.50 fair value, a 17% upside to its current price. Two Simply Wall St Community fair value estimates range from US$45.50 to US$86.28, underscoring how far apart individual views on upside potential can sit. When you set that against CareTrust’s record US$900 million quarter of investments in skilled nursing and seniors housing, it highlights why many investors are weighing the benefits of external growth against the rising execution and regulatory risks in these care driven markets. Explore 2 other fair value estimates on CareTrust REIT - why the stock might be worth just $45.50! Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts. A great starting point for your CareTrust REIT research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision. Our free CareTrust REIT research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate CareTrust REIT's overall financial health at a glance. Markets shift fast. These stocks won't stay hidden for long. Get the list while it matters: Capitalize on the AI infrastructure supercycle with our selection of the 55 best 'picks and shovels' of the AI gold rush converting record-breaking demand into massive cash flow. The future of work is here. Discover the 37 top robotics and automation stocks leading the charge in AI-driven automation and industrial transformation. We've uncovered the 10 dividend fortresses yielding 5%+ that don't just survive market storms, but thrive in them. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include CTRE. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Image source: The Motley Fool. Friday, Aug. 7, 2026 at 11:00 a.m. ET Chief Accounting Officer - Lauren Beale President and Chief Executive Officer - David Sedgwick Chief Financial Officer - Derek Bunker Chief Investment Officer - James Callister Operator: Hello, everyone. Thank you for joining us, and welcome to the CareTrust Second Quarter Earnings Call. [Operator Instructions] I will now hand the conference over to Lauren Beale, Chief Accounting Officer. Lauren, please go ahead. Lauren Beale: Thank you, and welcome to CareTrust REIT's Second Quarter 2026 Earnings Call. Today, we will make forward-looking statements based on management's current expectations, including statements regarding future financial performance, dividends, acquisitions, investments, financing plans, business strategies and growth prospects. These forward-looking statements are subject to risks and uncertainties that could cause actual results to materially differ from our expectations. These risks are discussed in CareTrust REIT's most recent Form 10-Q filing with the SEC. We do not undertake a duty to update or revise these statements, except as required by law. During the call, the company will reference non-GAAP metrics such as EBITDA, FFO and FAD. A reconciliation of these measures to the most comparable GAAP financial measures is available in our earnings press release and Q2 2026 financial supplement, which are available on the Investor Relations section of CareTrust's website at www.caretrustreit.com. A replay of this call will also be available on the website for a limited period. On the call this morning are David Sedgwick, President and Chief Executive Officer; Derek Bunker, Chief Financial Officer; and James Callister, Chief Investment Officer. I'll now turn the call over to Dave Sedgwick, CareTrust REIT's President and CEO. Dave? David Sedgwick: Thank you, Lauren, and good morning, everybody. Thank you for joining us. The CareTrust flywheel cranked up a few years ago when we hit around 7x our lifetime annual average of investments in 2024 and again in 2025. The team shows no signs of slowing. In fact, the opposite is true. After 2 back-to-back record-setting years, we are again on pace to deliver in a big way for our operators and shareholders. Last quarter was the single largest investment quarter in our company's history, excluding M&A activity, with approximately $900 million of investments at a blended yield of 8.9%. James, Kyle, Joe, Tri, Josh, JP, Nick, Martin, and Killian, that's the dream team right there responsible for a year's worth of investments in 1 quarter. I'm so proud of them and proud of the entire CareTrust team across the board: accounting, asset management, finance, tax, legal, data, operations. Everyone is rowing hard together to make this year a three-peat of record performance. Q2 results achieved record investments in the quarter, record revenues, record FFO per share and a healthy raise to guidance, built on a foundation of record operator lease coverage and operator quality care measures. Let me expand on that foundation just a little bit. We are stoked to see our operator quality care measures exceed the industry averages for overall star ratings, health inspections, quality measures, successful discharges and readmission rates. Let me repeat that. Our operators outperform industry averages for overall star ratings, health inspections, quality measures, successful discharges and readmission rates after they've had a chance to manage these buildings for at least 4 years. In my 2025 annual report letter, I discussed how mission-critical it is for us to lease our properties to high-quality operators and how we view the relationship between them and the value of our real estate investments. A quality operator is one who is driven by a mission, focuses their resources first on becoming the employer of choice and through that, becomes the quality care provider of choice in their market. Only after achieving sustained quality care outcomes can a provider and the real estate they operate achieve sustainable financial stability. We have seen this formula for success prove out over the last 25 years. A CareTrust operator is one who harmonizes mission-driven culture with the clinical and financial sophistication to adapt to an ever-changing environment. We apply those first principles to skilled nursing and senior housing alike. We invest for the long term. The price we pay and the operator we choose are intended to result in long-term quality care and, as a result, compounding value creation. That solid operator foundation and orientation allows us to grow in a sustainable and accelerated way across our 3 growth engines. Year-to-date, we have already closed on approximately $1.5 billion. And looking forward, the pipeline continues to reload and deal flow continues to be active and interesting across skilled nursing, care homes and SHOP, both in the U.S. and the U.K. With the balance sheet as strong as it is, the team is stronger than ever before and the opportunity set expanded and great relationships with partners and new and existing high-quality operators, there has simply never been a more exciting time for CareTrust. With that, I'll hand it off to James for a report on investment activity and the acquisition landscape. James? James Callister: Thanks, Dave. Good morning, everyone. During the second quarter, we closed on investments totaling approximately $900 million at a blended stabilized yield of 8.9%. That capital was deployed across the full breadth of the platform, U.S. skilled nursing sale leasebacks with quality operators in multiple geographies, the continued expansion of our U.K. Care Homes platform, sourced and executed by our London-based team, further growth in our SHOP portfolio and relationship-driven real estate loans, primarily as skilled nursing operators closed either alongside asset acquisitions or in anticipation of them. And as Dave noted, we haven't slowed down since the quarter ended. Since June 30, we've closed on an additional approximately $308 million at a blended stabilized yield of approximately 7.8%. Headlining that activity was a 16-property U.K. Care Homes portfolio net leased to a new operator relationship for CareTrust, joined by a two-community $65 million addition to our SHOP platform. Taken together, our 2026 investments now stand at approximately $1.5 billion year-to-date. Breaking that down, roughly $735 million in U.S. triple net skilled nursing and seniors housing, approximately $397 million in U.K. Care Homes, approximately $240 million in loans, and approximately $81 million in SHOP. Turning to what's ahead. The pipeline sits at approximately $540 million, roughly 2/3 skilled nursing and 1/3 loans to strategic partners plus U.K. Care Homes. It's a healthy mix, some singles and doubles alongside mid- to large portfolio opportunities. You'll note the immediate pipe doesn't include SHOP. That's really just a function of timing and discipline. The team continues to deepen relationships, including with high-performing operators, and we are confident these relationships will drive attractive on- and off-market opportunities that we expect to convert in future quarters and give us a long runway to scale that portfolio in both the U.S. and the U.K. And, our usual reminder on methodology, the quoted pipe includes only deals we have a reasonable level of confidence we can lock up and close within the next 12 months, and it typically excludes larger portfolios still under review. Stepping back for a moment, what gives us real confidence is that all 3 of our growth engines are producing. In skilled nursing, deal flow remains deep and steady with proprietary opportunities generated through long-standing relationships. In SHOP, even amid stiff competition and compressing cap rates, we're pursuing the right assets with the right operators and see a long runway to scale that portfolio in the quarters and years ahead. And in the U.K., our London-based team has widened our aperture considerably, new operators, new sources of deal flow and a pipeline that keeps building. Across all 3, the team continues to surface attractive opportunities to deploy capital, and we like our position in each of these markets. That growth will stay grounded in the same fundamentals that have served us well, disciplined underwriting, durable operator partnerships, and a creative collaborative approach to structuring. With that, I'll hand it to Derek to walk through the quarter's financial results. Derek Bunker: Thank you, James. For the quarter, normalized FFO increased 44% over the prior year quarter to $119.7 million, and normalized FAD increased 43% to $118.5 million. On a per share basis, normalized FFO was $0.51, an increase of approximately 19% over the prior year quarter. And normalized FAD was also $0.51, an increase of approximately 19% over the same period. In the second quarter, we raised approximately $364 million of gross proceeds from the settlement of outstanding equity forward contracts to fund investment activity in the quarter. Also in the quarter, we sold 14.4 million shares under forward equity contracts, raising $580.5 million of gross proceeds at a weighted average price of $40.23. And since quarter end, we sold another 2.2 million shares on a forward basis for gross proceeds of $90.6 million at a weighted average price per share of $41.46. As of today, we have approximately 16.6 million shares remaining unsettled under forward sale agreements, representing approximately $671.4 million in gross proceeds available to fund future investment activity. In yesterday's earnings press release, we raised our full year 2026 guidance, reflecting our year-to-date investment activity, including the volume we've closed since quarter end. We're now projecting normalized FFO per share of $2.03 to $2.06 and normalized FAD per share of $2.01 to $2.04. At the midpoint, that represents growth of 16.2% in normalized FFO per share and approximately 15.1% in normalized FAD per share compared to full year 2025 results. Our updated guidance is based on a weighted average diluted share count of 233 million shares and includes the following key assumptions: First, no new investments, loans, or dispositions beyond those made year-to-date; second, no new debt or equity issuances beyond those made year-to-date; third, 2.5% inflation-based rent escalators under our long-term triple net leases; fourth, $147 million of loans to be repaid throughout the year, of which approximately $104 million has been received so far to date; and fifth, no material change in the GBP to USD spot exchange rate. Additional guidance measures are detailed in the press release yesterday. Lastly, our liquidity continues to remain strong at approximately $1.4 billion as of today, including approximately $90 million of cash on hand, $605 million of availability under our $1.2 billion revolving credit facility and approximately $671 million of unsettled equity forward contracts. In addition, we have roughly $785.8 million of capacity available under our ATM program. Net debt to annualized normalized run rate EBITDA was 1.0x at quarter end, well below our long-term target range, and our fixed charge coverage ratio was 9.9x. We continue to have no scheduled debt maturities prior to 2028. With continued momentum and a reloaded investment pipeline, we have ample dry powder and multiple levers across our capital toolkit to keep funding our recent pace of investment activity. And with that, I'll turn it back to Dave. David Sedgwick: Thank you, Derek, and thank you, James, and thank you, everybody. We're really grateful for everybody's interest and support. As I hope you can tell, we are super bullish on the CareTrust story and not just what we've achieved, but where we are headed. And with that, I would be happy to answer any of the questions that you might have at this time. Operator: [Operator Instructions] Your first question comes from John Kilichowski with Wells Fargo. William John Kilichowski: James, maybe if I could start with you. You gave some helpful color in the opening remarks, especially about building out the SHOP pipeline and it not being mentioned in the -- or SHOP not being mentioned in the current pipeline. Could you talk a little bit more about building those relationships with operators and how that will eventually translate into volumes and how we should think about the cadence of that? James Callister: Yes, sure. I mean, I think that it's hard to predict the cadence, John. You're never really sure what's going to hit the market or what off-market is going to come. But I think that building relationships with these operators and managers, finding the ones you can use in different regions of the country or have proven track records there that have maybe experiences with other publics and their reporting and back office just really allows you to more quickly pursue transactions that come up. It opens up the off-market pipeline as you develop relationships with them. And really, as you really start to develop frameworks with them of what your deal with them would look like, the terms on which you do it. And you get really all that kind of prebaked so you can react quickly when the right deal in the right area comes up for you to work with that particular operator or manager. And I think the team has done a great job of developing a lot of those relationships and being ready really to continue and ramp up pursuing acquisitions in different parts of the country. William John Kilichowski: And then would you also mind talking about the portfolio deals outside of the quoted pipeline? Maybe you don't want to speak to specific deals, but can you talk about the composition of where you're seeing those opportunities? Or is it more SNF tilted? Are there SHOP portfolios out there that you're currently evaluating? I'm just kind of curious what the composition looks like more than anything. James Callister: Yes. I mean there's a few portfolios tinkering around out there. I would say there's 1 or 2 SHOP portfolios that are larger out there that we're reviewing to see how attractive they are and whether we want to pursue them. There's also, I'd say, the same for SNF and 1 or 2 in the U.K. as well. So there's always seemingly a couple of them floating around, but there are a couple of shops out there that we're looking at, but we'll see if they're really worth us pursuing or if we think that there's traction there. Operator: Your next question comes from Austin Wurschmidt with KeyBanc Capital Markets. Austin Wurschmidt: With respect to the Care Home portfolio investment in August, I think this might be one of the largest purchases you've done in the U.K. since acquiring Care REIT. But what I'm wondering is how much of the scale impact pricing? And do you view this deal to open the door to potential future deals given the new relationship there with the operator? James Callister: Yes. I mean the scale did impact the pricing a little bit, Austin. I would say that 16 facilities, it doesn't -- deals that size in the U.K. don't come around all the time. So there's definitely a teeny bit of a premium there. We definitely see it as a launching point with this operator. We feel like they've demonstrated in the past their ability to operate at scale and to operate well at scale. And this is really their first jump back in after selling their portfolio last year. So we definitely see it as a launching pad to grow with them in the future. Austin Wurschmidt: And then, Dave, as you think about tenant and geographic concentration and kind of ensuring that you do have the right diversification balanced with partnering with the highest quality operators consistent with the above-average metrics that you highlighted in your opening remarks. I mean, how do you think about striking that right balance moving forward? David Sedgwick: Well, I think one of our first principles as we started the company was that the underwriting always starts and ends with who is the operator going to be. And if we do not have what we think is a quality operator to match with a great opportunity, we're simply going to pass on that deal. We'd much rather take an A operator in a B market than settle for a mediocre operator in a great market. So that's just in our DNA. That's the discipline we have. And if we do have -- which we do have great operators, we don't mind concentration building with one or another because over time, the diversification and concentration sort of takes care of itself. Operator: Your next question comes from Juan Sanabria with BMO Capital Markets. Robin Haneland: This is Robin Haneland sitting in for Juan. I was curious if there are any opportunities to convert existing senior housing tenants to either SHOP in the U.S. or U.K.? David Sedgwick: We've certainly thought about that. The challenge that we have in doing that is that our senior housing portfolio here in the U.S. and in the U.K. covers rent really well. And so there's very little motivation for the operators to walk away from that type of lease coverage. I think a lot of those conversions that have happened in our space have been kind of from a defensive posture where maybe things haven't been performing super well or there hasn't been really strong coverage. And so it was more of a defensive play to convert to SHOP. So because ours covers so well, there's less opportunity to do that. And however, as we look forward, everything is on the table. But I think more likely for us, SHOP will be coming from being on offense and identifying great assets that we really want to own and have operations responsibility for with great partners. Robin Haneland: And as a follow-up, I wanted to ask on where things stand with PACS today? What's the willingness to move forward? What have the discussions been sort of year-to-date? David Sedgwick: Yes. So we're really pleased to see PACS' performance this year, happy to see them back to normal filing cadence. Really happy to see their investments in compliance and happy to see them back on the growth path. We haven't done anything with PACS for a while, but that's not for lack of trying. We have looked at some deals with them, and we'd be happy to grow with them again if the opportunity presents itself. Operator: Your next question comes from Michael Goldsmith with UBS. Michael Goldsmith: James, in your prepared remarks when talking about the U.K., I think you talked about widening the aperture. So maybe you can provide a little bit more color of what you meant specifically by that? James Callister: Sure. I think what I mean by that is that I think the team there has done a great job of going beyond just seeing marketed deals, but also using operator relationships and other relationships they have or that we've formed to bring more pipeline or sources of deals than just the traditionally marketed deals. I think also that as you start to look at maybe structures beyond just the triple net, they've done a great job starting to form relationships for us to start looking at deals like that, that might work in other structures like a SHOP if something presented itself. So I think, Michael, that's pretty much what I mean. Just opening the way in which deals come to us beyond just traditionally marketed deals and thus really increasing the chance as we get more opportunities. Michael Goldsmith: Got it. And maybe just to follow up on John's question earlier about the SHOP in the pipeline. I think you cited timing and discipline. So like obviously, like how do you -- like you can only take advantage of the opportunities that you see. At the same time, you are trying to maintain a certain level of discipline around what you're seeing, but then also you know like the underlying strength of the business is so strong and it feels like everyone is outperforming their own underwriting. So how do you kind of manage that across the portfolio and your opportunities that you're seeing and making sure that you're in on the right deals and then also -- and making sure you're not missing out on things, but also not just acquiring just for the sake of acquiring? James Callister: Yes. I mean it's a tough balance, I would say. But I think what we try to do is we try to really look at deals and pick our spots, right? And we try to find those opportunities where we feel like there's real confidence that we have that this can get to an IRR that we really want to pursue, and we'll stretch to try to go get it. But on the other hand, we don't feel a huge compulsion to have to stretch to do a deal that doesn't make sense for us. We're finding opportunities to put money to work in really good deals on the SNF side and in the U.K. Care Home side. And so when it comes to SHOP, we're going to continue developing relationships, continue to look at and underwrite a lot of deals. We're going to continue to pick our spots with the right partners, operators and stretch to try to go get those opportunities, but not go beyond what we feel is wise or prudent just in the name of growth. So I think we work really hard to try to pick those spots knowing that we don't have to do a deal to grow when we've got opportunities with SNFs and care homes. Operator: Your next question comes from Michael Carroll with RBC Capital Markets. Michael Carroll: James, just with the increased private market interest in the health care real estate space in general, I mean, how has that impacted acquisition cap rates? I mean have you seen cap rates just broadly drift lower? And is there any one property type where you've seen that more apparent? I know I think in the past, you highlighted there's probably the most competition in the SHOP space. But what have you seen on the SNF space and maybe the U.K. Care Home space? James Callister: I mean, yes, SHOP is pretty well out there. There's a lot more private market entrants right now. Cap rates are compressing as a result. You've got more competitive processes. I think in the SNF world, we don't see too much of that really at all. I think you see the same players that there's been over the past several years, same buyer pool, I think, really competing for the deals. And so portfolio deals in SNFs, larger deals, you maybe see a little teeny bit of compression in cap rates. But overall, you still see the same where they've been. It's just really having relationships that help you source more off-market because there is more off-market than listed in the SNF world. And in the U.K., I think you do see a slow influx of additional players on the private entrant side for sure. I don't think we've seen it impact dramatically the competitive process. But I would say you see an uptick in buyer entrants, but I haven't seen it really have that much of an impact at all on cap rates or bidding up processes. Michael Carroll: Okay. Great. And then, I guess, Derek or Dave, could you talk about the purchase options? I know that you have a few meaning your tenants can potentially acquire one of your current assets. I know there was a window that opened up for one specific smaller purchase option, and there's a few that's coming up here over the next few quarters or so. I mean how should we think about that? Or do you think that those could potentially be executed on? Or is that just an option out there that will just kind of expire eventually? Derek Bunker: Mike, we do expect and kind of bake in that there's a high likelihood that those will be exercised. Of course, until we get the notices of exercise, it's always uncertain and people's capital needs and plans change all the time. But I think we're constantly in discussion with those tenants that have options. It's a good relationship. It's collaborative. And it's not the end of the world that they exercise. We always look to do deals down the road with them in the future. But as of right now, we put a high likelihood that those would be exercised. Operator: Your next question comes from Farrell Granath with Bank of America. Farrell Granath: My first one is on the composition of your financing receivables. I know that, that can also refer to your sales leaseback. So curious if -- what percentage of that is potentially SNFs, given that SNFs has been a smaller proportion of your acquisition pipeline as outright purchases? Derek Bunker: Yes. Farrell, it's Derek. It's almost 100% SNFs. These are really exciting, compelling sale-leaseback opportunities. The bulk of the financing receivables have purchase options that are 8, 9 years out. And there's a lot of uncertainty in the meantime about those exercise. We view them more in substance as owned triple net. But for accounting purposes, it falls within the financing receivable bucket. But these are really quality -- high-quality assets in the skilled nursing space. Farrell Granath: Okay. And then also just given the growing debate around the path of Fed policy, I'm curious how you're thinking about your cost of capital and especially being able to leverage either your balance sheet or also continue to lean into your equity, if there's any updated thoughts. Derek Bunker: Yes. We prepare for all uncertainties, and I think it's a benefit of having relatively low leverage. It gives us the optionality depending upon Fed policy and other macro factors. So we really like carrying a little balance on the revolver. It's competitive for us. We really like the price of our equity right now. We've got the optionality to do something longer term or a term loan. All those are on the table. We're looking at the full toolkit. And for right now, looking at the pipeline, we've got earmarked probably the settlement of our equity forwards and then some. And so I think we've given ourselves some runway to maneuver and be flexible depending upon how those macro conditions continue to unfold. But right now, we're really just pricing it out and watching those rates daily and trying to be opportunistic about it. Operator: Your next question comes from Rich Anderson with Cantor Fitzgerald. Richard Anderson: So there's one pretty clear disconnect going on in your world, and that is you guys are not finding many in the way of SHOP transactions, and I know you're working hard at it, but some of your peers are -- it's raining SHOP. And so you're not going to talk about their process, but -- and you're the one with the best cost of capital in the group. So I guess it all doesn't sort of ring clear to me, except for the fact that you're going to be very disciplined in all of that. But when you're on the ground looking at deals that you're competing with, I mean, how far off are you missing from the ultimate winner? Is it coming down to pricing? What is it that's causing yours to be such a slow out-of-the-gate process in SHOP, whereas others are really moving quite fast? David Sedgwick: Maybe James can give a little bit of more vibrant color to the specific question on how far off are we versus the competition. But I would say one of the main differences between us and some of our peers is we have not -- we view SHOP as a long-term complementary growth engine to the CareTrust story. I think some of our peers have really pivoted and gone all in on SHOP. And with that type of publicized strategic change, there's quite a bit of motivation on their side to put money to work and show that's -- that they're executing on that new strategy. Whereas we have, I think, the luxury of being opportunistic across all 3. And if we have the ability to put double-digit FFO per share growth by maintaining that discipline and being opportunistic across all 3, we really prefer that approach than kind of putting ourselves in a corner per se to have to do a ton of SHOP to show that we're executing on a particular strategy. I think that's high level why it appears that we've been more measured in our deployment of SHOP capital. But I wouldn't be surprised either, Rich, if we did do a large SHOP portfolio deal in the future. For us, that can happen because there are portfolios out there that I think will eventually check all the boxes for us. Richard Anderson: Okay. And James, any comment on the -- where you're missing? James Callister: Yes. I mean, look, it's no -- if you're missing, you're almost always missing on price, right, Rich? And so when we look at it and we look at a deal and we say, look, what do we feel like the projections are here? What's the IRR going to be? What's the return? What's the risk-adjusted return? And you start getting facilities that are portfolios that are in the mid-90s occupancy that are stable, where the pricing is going to a mid- to low 5 cap, and you start looking at that versus a plethora of SNF and other opportunities that are going to be in the 9s or high 8s and you start looking at the risk-adjusted return and you think maybe it's wiser to put some allocated capital to where we have the most opportunities with a better risk-adjusted return for us if the pricing is just going to be too risky for us and not get the returns that we're looking for. So that's really what the process that you go through. Richard Anderson: Yes. Okay. And then last quickly for me. Dave, maybe for you, like what do you like about the skilled nursing business? And I asked that question a little tongue in cheek, but you're obviously making a spread on your investments. But if for some reason, the acquisition environment suddenly screeched to a halt, you'd be stuck with a 2% growth platform in skilled -- U.S. skilled nursing. So assuming I'm right about that, like what is the draw to skilled nursing as an industry for you? And I'm not suggesting it's right or wrong. I'm just asking the question, your perspective on it. David Sedgwick: We've got a long -- as you know me, I personally and we as a company, have a long relationship and history in skilled nursing. That's where we come from back in the Ensign days in 1999 when Ensign started. So we know and love this business. We view it as a vital part of the health care continuum in the country. We see it as too important to fail. We saw that during the pandemic. And we see as the demographics continue to blow up over the next 25 years that it will continue to be a really important part of the health care continuum. Not only that, because our history is so deep with skilled nursing, I think we do -- as our lease coverage track record demonstrates, I think we do a really good job of identifying the best operators out there who can do it the right way, providing high-quality care. And to James' earlier point, what it does is it produces really high risk-adjusted returns for us compared to just about any other asset class. Richard Anderson: I do like that too important to fail comment. Operator: Your next question comes from Alec Feygin with Baird. Alec Feygin: Are there any portfolio initiatives that you're working on with SNF operators, large or small? David Sedgwick: What do you -- I'm not sure what you're asking. What do you mean portfolio initiatives? Alec Feygin: So there's been some other of your peers working on some pretty large portfolio initiatives, either replacing operators, doing changes to leases, extending leases. Is there any of that going on in your portfolio? David Sedgwick: No. I mean there's always some -- there's always scrutiny, right, on the portfolio. But as you look in the SHOP, you see just really, really healthy lease coverage. But even with that, there's -- the asset management, portfolio management team here is always looking to improve and take assets from maybe weakening hands to stronger hands. But there's nothing that's currently underway that would impact guidance or our results at all, nothing of significance. Operator: Your next question comes from [ Eddie ] Rodgers with Raymond James. David Rodgers: It's Dave. I know, Dave, that there's always headlines and risk from a regulatory standpoint out there. But I'm wondering maybe to ask that question in a different way. Are you seeing anything in the acquisition pipeline that either the operators are bringing you or you're increasingly turning down where there's more risk and vice versa, are there asset types or areas where you're now feeling there's less risk that are opening up opportunities? And I don't know if that's more rehab, less skilled, whatever the case might be. Are you seeing any shift within the mix in kind of the skilled nursing business that's given you this opportunity to continue to acquire so well? David Sedgwick: No. Dave, I'd characterize the skilled nursing environment right now as stable. I think from a regulatory standpoint, from a reimbursement standpoint, there have definitely been previous periods of time that have been more choppy. But right now, I'd say it's really stable. I think the operators and we feel comfortable with it. And there's quite an appetite to grow in today's environment. David Rodgers: And then maybe one follow-up. It's pretty small, but the loan to own that closed in the third quarter. One, any details about that small asset? And then maybe a bigger question around that, is that instructive or could that be instructive of any way where you might get more assets back that you'd want to own more quickly? James Callister: David, are you talking about Q3? David Rodgers: Yes. James Callister: Yes. I mean that's really a function of, I think, what you're talking about is the -- in the U.K., sometimes some of the parts of the transactions have to be structured a little differently as kind of a loan to own to facilitate closing while licensure is being received. So we anticipate that would turn into real estate in the next 6 to 12 months. For instance, we closed a transaction last fall that was under this loan to own. And just recently, they got the licensure and converted into the real estate. So that's really what that is. It's just a function to help facilitate closing earlier while you're waiting for licensure. Operator: Your next question comes from Michael Stroyeck with Green Street. Michael Stroyeck: It sounds like loans are a decent chunk of the pipeline. Can you just talk about the strategic rationale of these particular loans and if we should expect loans to continue to be a meaningful part of external growth moving forward? James Callister: Yes. I mean there's always a purpose behind the loans, Michael, really. It's that they're either going to be done alongside asset acquisitions or in contemplation of. So whether it's a purchase option or an agreement that real estate deals will follow. It's really a way for us to unlock the door to future real estate acquisitions with that particular borrower or operator. And so those relationships, that cycle has been a very virtuous one for us. It's been very successful for us in the past and been a driver of a lot of the growth that's happened over the last couple of years in a cycle that with the right operators and the right properties that will continue to feed. It's never going to become anywhere close to the primary business, but it will be fluctuate quarter-to-quarter. But when those opportunities arise and we see real estate in the future, it's a cycle we'll feed. Michael Stroyeck: Understood. And maybe one on the most recent SHOP deal. I guess where do you ultimately see that mid-6% yield stabilizing at? And what's the time frame that you guys are assuming there? James Callister: Yes. I mean I think it's -- those 2 are pretty stable assets. I think that we see a lot of opportunity for -- they're well positioned for rate growth. They're well positioned for some OpEx savings. One of the facilities has some expansion potential that we're actively looking at. So we definitely see a low double-digit IRR return there. And I think really, we would look at margin expansion from the low 30s to the high 30s in the next 2 to 3 years. Operator: Your next question comes from Jyoti Yadav with Mizuho. Jyoti Yadav: This is Jyoti on for Vikram. So you guys mentioned record coverage. Can you talk about perhaps like potential for rent resets like over time or at expirations? David Sedgwick: Yes. I think in the supplemental, we show the maturity of our rents starting, I think, in 2031. So that's when the conversation kind of begins. The lease coverage is so strong overall that as we get there in 2031 and beyond, there will certainly be opportunities to reset those rents to more market rates, but it's a few years off. Operator: There are no further questions at this time. I will now turn the call back to Dave Sedgwick with closing remarks. David Sedgwick: Well, thank you, everybody, for your time and interest. Really just want to take a second to again acknowledge the amazing team here at CareTrust and thank them for their hard work. Thank you for our operators as well as setting the high standard of quality care out there that allows us to continue to expand our and their missions. Hope everybody has a great weekend. Operator: This concludes today's call. Thank you for attending. You may now disconnect. Before you buy stock in CareTrust REIT, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and CareTrust REIT wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $400,209!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,375,393!* Now, it’s worth noting Stock Advisor’s total average return is 964% — a market-crushing outperformance compared to 215% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 13, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. CareTrust REIT (CTRE) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Interested in CareTrust REIT, Inc.? Here are five stocks we like better. Record investment activity: CareTrust REIT closed approximately $900 million of investments in Q2 at an 8.9% blended stabilized yield, bringing 2026 year-to-date investments to about $1.5 billion across skilled nursing, U.K. care homes, loans, and SHOP properties. Strong financial performance: Second-quarter normalized FFO rose 44% year over year to $119.7 million, or $0.51 per share, while normalized FAD increased 43% to $118.5 million. The company raised its 2026 guidance to normalized FFO of $2.03–$2.06 per share. Capital flexibility with selective SHOP strategy: CareTrust reported approximately $1.4 billion in liquidity and low leverage, but management remains disciplined in the highly competitive SHOP market, prioritizing attractive returns and partnerships with high-quality operators. CareTrust REIT (NYSE:CTRE) reported record second-quarter investment activity and raised its full-year 2026 guidance, citing continued deal flow across U.S. skilled nursing, U.K. care homes, senior housing operating properties (SHOP), and strategic real estate loans. President and Chief Executive Officer David Sedgwick said the company closed approximately $900 million of investments during the second quarter at a blended stabilized yield of 8.9%, representing its largest quarterly investment total excluding M&A activity. He said the quarter also produced record revenue and funds from operations per share. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth “After two back-to-back record-setting years, we are again on pace to deliver in a big way for our operators and shareholders,” Sedgwick said. Chief Investment Officer James Callister said CareTrust’s second-quarter investments covered the company’s full platform, including U.S. skilled nursing sale-leasebacks, U.K. care homes, SHOP investments, and loans to skilled nursing operators that were made alongside, or in anticipation of, asset acquisitions. → Sandisk Just Delivered a Blowout Quarter—Here's Why the Stock Is Falling Since June 30, the company has closed an additional approximately $308 million of investments at a blended stabilized yield of about 7.8%. That activity included a 16-property U.K. care homes portfolio leased to a new CareTrust operator relationship and a $65 million, two-community addition to its SHOP platform. CareTrust’s investments for 2026 stood at approximately $1.5 billion as of the call, comprising: About $735 million in U.S. triple-net skilled nursing and senior housing investments; Approximately $397 million in U.K. care homes; Approximately $240 million in loans; and Approximately $81 million in SHOP investments. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High The company’s current investment pipeline totaled about $540 million, with roughly two-thirds tied to skilled nursing and one-third consisting of loans to strategic partners and U.K. care homes. Callister said the pipeline includes transactions the company has a reasonable level of confidence it can close within the next 12 months and generally excludes larger portfolios still under review. While the immediate pipeline does not include SHOP opportunities, Callister said that reflects timing and underwriting discipline rather than a retreat from the property type. He said CareTrust continues to develop relationships with operators and managers that could help it move quickly when suitable opportunities arise. Management said competition has been particularly significant in SHOP, where Callister said more private-market entrants have contributed to cap-rate compression and more competitive acquisition processes. The company is reviewing larger SHOP portfolios but said it remains selective about pricing and expected returns. In response to questions about CareTrust’s more measured pace in SHOP compared with some peers, Sedgwick said SHOP is intended to be a long-term complementary growth engine rather than the company’s sole strategic focus. The company can instead allocate capital among its three growth areas, including skilled nursing and U.K. care homes. Callister said the company typically loses SHOP opportunities on price when projected returns no longer meet its underwriting standards. He cited cases involving stable portfolios with occupancy in the mid-90% range that have been priced at mid- to low-5% capitalization rates, compared with skilled nursing and care-home opportunities generating yields in the high-8% to 9% range. CareTrust said its U.K. team has broadened its sourcing beyond traditionally marketed transactions by cultivating operator and other industry relationships. Callister also said the company is considering structures beyond triple-net leases, including potential SHOP arrangements when appropriate. Chief Financial Officer Derek Bunker said normalized FFO increased 44% year over year to $119.7 million in the second quarter, while normalized funds available for distribution, or FAD, rose 43% to $118.5 million. On a per-share basis, normalized FFO and FAD were each $0.51, up approximately 19% from the prior-year period. CareTrust raised its full-year 2026 outlook, now projecting normalized FFO per share of $2.03 to $2.06 and normalized FAD per share of $2.01 to $2.04. At the midpoint, the guidance would represent 16.2% growth in normalized FFO per share and approximately 15.1% growth in normalized FAD per share compared with 2025. The updated outlook assumes no investments, loans, dispositions, debt issuances, or equity issuances beyond those completed year to date. It also assumes 2.5% inflation-based rent escalators under long-term triple-net leases, $147 million in loan repayments during the year, and no material change in the British pound-to-U.S. dollar exchange rate. Bunker said approximately $104 million of expected loan repayments had been received so far. The company reported approximately $1.4 billion of liquidity, including about $90 million of cash, $605 million available under its revolving credit facility, and approximately $671 million in unsettled equity forward contracts. CareTrust also had about $785.8 million of capacity under its at-the-market equity program. Net debt to annualized normalized run-rate EBITDA was 1.0 times at quarter-end, while fixed-charge coverage was 9.9 times, according to Bunker. The company has no scheduled debt maturities before 2028. Sedgwick emphasized that CareTrust’s underwriting begins with operator selection. He said the company’s operators exceeded industry averages in overall star ratings, health inspections, quality measures, successful discharges, and readmission rates after managing facilities for at least four years. Management said it remains willing to allow concentration with high-quality operators to build over time. Sedgwick said CareTrust would rather partner with what it considers an “A operator” in a less attractive market than accept a weaker operator in a stronger market. On skilled nursing, Sedgwick described the current operating environment as stable from both a regulatory and reimbursement perspective. He said CareTrust views skilled nursing as an important component of the healthcare continuum and continues to see attractive risk-adjusted returns from the sector. CareTrust REIT, Inc is a real estate investment trust based in Deerfield Beach, Florida, specializing in the ownership, acquisition and management of net-leased healthcare properties. The company primarily focuses on seniors housing and post-acute care facilities, entering into long-term, triple-net lease agreements with leading operators in the skilled nursing, assisted living, memory care, inpatient rehabilitation and specialty hospital sectors. Through its portfolio, CareTrust REIT aims to provide investors with stable and predictable rental income while supporting the ongoing demand for quality healthcare real estate across the United States. Since its initial public offering in September 2013, CareTrust REIT has pursued a disciplined acquisition strategy, targeting properties in primary and select secondary markets. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "CareTrust REIT Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Normalized FFO: $119.7 million, up 44% year-over-year. Normalized FAD: $118.5 million, up 43% year-over-year. Normalized FFO per Share: $0.51, up approximately 19% year-over-year. Normalized FAD per Share: $0.51, up approximately 19% year-over-year. Total Investments (Q2): Approximately $900 million at a blended stabilized yield of 8.9%. Total Investments (Year-to-Date): Approximately $1.5 billion, including $308 million closed since June 30 at a blended yield of approximately 7.8%. Investment Breakdown (Year-to-Date): Approximately $735 million in U.S. triple net skilled nursing and seniors housing, $397 million in U.K. care homes, $240 million in loans, and $81 million in SHOP. Investment Pipeline: Approximately $540 million, roughly two-thirds skilled nursing and one-third loans to strategic partners plus U.K. care homes. Equity Issuance (Q2): Sold 14.4 million shares under forward equity contracts, raising $580.5 million at a weighted average price of $40.23. Equity Issuance (Post-Quarter): Sold 2.2 million shares on a forward basis for $90.6 million at a weighted average price of $41.60. Unsettled Forward Shares: Approximately 16.6 million shares, representing $671.4 million in gross proceeds. Full-Year 2026 Guidance: Normalized FFO per share of $2.03 to $2.06 and normalized FAD per share of $2.01 to $2.04. Liquidity: Approximately $1.4 billion as of today, including $90 million cash, $605 million under the revolving credit facility, and $671 million of unsettled equity forwards. Net Debt to EBITDA: 1.0x at quarter end. Fixed Charge Coverage Ratio: 9.9x. Warning! GuruFocus has detected 7 Warning Signs with CTRE. Is CTRE fairly valued? Test your thesis with our free DCF calculator. Release Date: August 07, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Record investment quarter with approximately $900 million deployed at a blended yield of 8.9%, and year-to-date investments of $1.5 billion. Strong financial performance with normalized FFO and FAD per share up 19% year-over-year, and raised full-year 2026 guidance. Operators outperform industry averages in quality care metrics, including star ratings, health inspections, and readmission rates. Robust balance sheet with low leverage (net debt to EBITDA of 1.0x), ample liquidity of $1.4 billion, and no debt maturities before 2028. Diversified growth across three engines: U.S. skilled nursing, U.K. care homes, and SHOP, with a pipeline of $540 million and strong deal flow. SHOP acquisition pipeline is currently limited due to timing and discipline, with stiff competition and compressing cap rates in that space. Potential for tenant purchase options to be exercised, which could reduce the asset base, though considered likely. Guidance assumes no new investments or financing beyond year-to-date, indicating potential uncertainty in future deployment. U.K. care home portfolio deal required a slight premium due to scale, impacting pricing. Dependence on equity forward contracts and ATM program for funding, which may be affected by market conditions and Fed policy. Q: Can you discuss the strategic rationale behind the significant volume of loans in the pipeline and whether loans should continue to be a meaningful part of external growth?A: James Callister, Chief Investment Officer, explained that loans are always purposeful, either done alongside asset acquisitions or in contemplation of them, serving as a way to unlock future real estate deals with the borrower. He noted this "virtuous cycle" has been a key driver of growth over the past couple of years and will continue to feed the pipeline, though it will never become the primary business. Q: How should we think about the cadence of building the SHOP pipeline and how relationships with operators will translate into volumes?A: James Callister, Chief Investment Officer, stated that while predicting cadence is difficult, developing relationships with operators and managers, finding those with proven track records, and pre-baking deal frameworks allows the company to react quickly when the right opportunities arise. The team has done a great job developing these relationships to ramp up acquisitions in different parts of the country. Q: Given the increased private market interest in healthcare real estate, how has that impacted acquisition cap rates across different property types?A: James Callister, Chief Investment Officer, noted that SHOP is seeing more private market entrants and cap rate compression. In the SNF world, the buyer pool remains consistent with minimal cap rate impact, though larger portfolio deals may see slight compression. In the U.K., there is a slow influx of new players, but it hasn't dramatically impacted competitive processes or cap rates. Q: Can you provide more color on what you meant by "widening the aperture" in the U.K. and how that impacts deal flow?A: James Callister, Chief Investment Officer, explained that the London-based team has gone beyond just marketed deals, using operator relationships to bring more pipeline and sources of deals. They are also exploring structures beyond triple net, such as SHOP, which increases the chances of finding more opportunities. Q: How do you balance the need for tenant and geographic diversification with partnering with the highest-quality operators?A: David Sedgwick, President and CEO, emphasized that underwriting always starts and ends with the operator. The company would rather take an A operator in a B market than a mediocre operator in a great market. With great operators, they don't mind concentration building, as diversification tends to take care of itself over time. Q: Are there opportunities to convert existing senior housing tenants to SHOP in the U.S. or U.K.?A: David Sedgwick, President and CEO, noted that their senior housing portfolio covers rent well, so there's little motivation for operators to convert. Most conversions in the space have been defensive plays. For CareTrust, SHOP growth will likely come from being on offense, identifying great assets with great partners. Q: Where do things stand with PACS today, and what's the willingness to move forward with them?A: David Sedgwick, President and CEO, expressed pleasure with PACS' performance this year, noting their return to normal filing cadence and growth path. While CareTrust hasn't done any deals with PACS recently, they have looked at some opportunities and would be happy to grow with them again if the right opportunity presents itself. Q: Can you talk about the purchase options that tenants may exercise on current assets, and how should we think about those being executed?A: Derek Bunker, Chief Financial Officer, stated that they expect a high likelihood those options will be exercised, though it's uncertain until notices are received. The company maintains collaborative discussions with tenants holding options, and it's not the end of the world if they exercise, as they look to do future deals with them. Q: What is the composition of your financing receivables, and what percentage is potentially SNFs?A: Derek Bunker, Chief Financial Officer, confirmed that the financing receivables are almost 100% SNFs, representing compelling sale-leaseback opportunities with purchase options eight to nine years out. They view these more in substance as owned triple net, but for accounting purposes, they fall within the financing receivable bucket. Q: Given the debate around Fed policy, how are you thinking about your cost of capital and leveraging your balance sheet or equity?A: Derek Bunker, Chief Financial Officer, noted that low leverage provides optionality depending on Fed policy and macro factors. They like carrying a little balance on the revolver, and the price of equity is attractive. They have earmarked settlement of equity forwards for the pipeline and are watching rates daily to be opportunistic with their full capital toolkit. Q: Why is CareTrust's SHOP growth slower than peers, and how far off are you from winning deals?A: David Sedgwick, President and CEO, explained that CareTrust views SHOP as a long-term complementary growth engine, while some peers have pivoted all-in on SHOP, creating motivation to deploy capital. CareTrust prefers being opportunistic across all three growth engines to maintain double-digit FFO per-share growth. James Callister, Chief Investment Officer, added that when missing deals, it's almost always on price, as they compare risk-adjusted returns against SNF opportunities in the high 8s to 9s. Q: What do you like about the skilled nursing business, and what's the draw to the industry?A: David Sedgwick, President and CEO, cited the company's long history in skilled nursing, dating back to Ensign in 1999. He views it as a vital part of the healthcare continuum that's "too important to fail," especially with demographics expanding over the next 25 years. Their deep history helps identify the best operators, producing high risk-adjusted returns compared to other asset classes. Q: Are there any portfolio initiatives underway with SNF operators, such as replacing operators or changing leases?A: David Sedgwick, President and CEO, indicated there's always scrutiny on the portfolio, but nothing significant is currently underway that would impact guidance or results. The asset management team is always looking to improve assets, but there are no major initiatives in progress. Q: Are you seeing any shifts in the skilled nursing business that are opening up opportunities, or are you turning down more deals due to risk?< For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management attributes record performance to a 'flywheel' effect established over the last two years, resulting in the single largest investment quarter in company history with approximately $900 million deployed. The company's investment philosophy prioritizes 'A' operators in 'B' markets, asserting that mission-driven cultures are the primary drivers of sustainable financial stability and real estate value. Operational outperformance is evidenced by operator quality care measures exceeding industry averages in star ratings and readmission rates for facilities managed for at least four years. Strategic positioning relies on three distinct growth engines: U.S. skilled nursing (SNF), Senior Housing Operating Portfolios (SHOP), and an expanding U.K. Care Homes platform. Management maintains a disciplined approach to SHOP acquisitions, choosing to pass on low-cap-rate deals in favor of higher risk-adjusted returns found in the SNF and U.K. sectors. The U.K. expansion is being accelerated by a dedicated London-based team that has widened the deal-sourcing aperture beyond traditionally marketed transactions. Updated 2026 guidance assumes 2.5% inflation-based rent escalators and the repayment of approximately $147 million in loans throughout the year. The $540 million near-term pipeline is intentionally weighted toward skilled nursing (2/3) and strategic loans, excluding SHOP due to current market pricing and timing discipline. Management anticipates that several tenant purchase options are highly likely to be exercised in the coming quarters, which is already factored into long-term planning. Future SHOP growth is expected to be 'offensive,' focusing on identifying high-quality assets with expansion potential rather than defensive conversions of existing triple-net leases. The company intends to utilize its $1.4 billion in liquidity and unsettled equity forwards to maintain its current aggressive pace of investment activity. Financing receivables are almost 100% skilled nursing assets, which management views as 'in-substance' triple-net owned real estate despite their accounting classification. The U.K. portfolio utilizes 'loan-to-own' structures to facilitate closings while awaiting licensure, with these expected to convert to real estate within 6 to 12 months. Management views the skilled nursing regulatory and reimbursement environment as currently 'stable' compared to previous choppy periods, supporting continued aggressive acquisition. Net debt to annualized normalized run rate EBITDA stands at 1.0x, providing significant optionality to navigate potential shifts in Fed interest rate policy. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management explained that while peers are aggressively pivoting to SHOP, CareTrust remains opportunistic across all three engines to avoid overpaying for low-cap-rate assets. They noted that missing on SHOP deals is almost always a function of price, specifically refusing to chase mid-to-low 5% cap rates when SNF yields remain in the 8-9% range. The 16-property deal is viewed as a 'launching pad' for a new operator relationship with a partner that has a proven track record of operating at scale. Management acknowledged a slight pricing premium due to the rare opportunity to acquire a portfolio of that size in the U.K. market. While current lease coverage is exceptionally strong, management noted that significant lease maturities do not begin until 2031. They confirmed that those future maturities will provide opportunities to reset rents to market rates, but it is not a near-term catalyst.

Conference Call Scheduled for Friday, August 7, 2026 at 11:00 am ET DANA POINT, Calif., August 06, 2026--(BUSINESS WIRE)--CareTrust REIT, Inc. (NYSE:CTRE) today reported operating results for the quarter ended June 30, 2026, as well as other recent events. For the quarter, CareTrust reported: Net income of $89.0 million and net income per diluted weighted average share of $0.38, an increase of $0.03, or 9%, over the prior year quarter; Normalized FFO of $119.7 million and Normalized FFO per diluted weighted average share of $0.51, an increase of $0.08, or 19%, over the prior year quarter; Normalized FAD of $118.5 million and Normalized FAD per diluted weighted average share of $0.51, an increase of $0.08, or 19%, over the prior year quarter; $899.6 million of investment activity closed at a blended stabilized yield of 8.9%; $578.2 million of gross proceeds from a forward equity offering, which remain unsettled; $363.6 million of gross proceeds from settlement of equity forward contracts under the ATM Program; Net Debt to Annualized Normalized Run Rate EBITDA of 1.01x; 100.0% collection of contractual rent and interest; and A quarterly dividend of $0.39 per share, representing a payout ratio of approximately 76% of Normalized FAD. Since quarter end, CareTrust reports: $307.9 million of investment activity closed at a blended stabilized yield of 7.8%; A $540 million investment pipeline; $605 million available under its $1.2 billion unsecured revolving credit facility as of August 6, 2026; $90 million of cash on hand as of August 5, 2026; and $671 million in gross proceeds outstanding under equity forward contracts. CareTrust’s Chief Executive Officer, Dave Sedgwick, commented, "Q2 was another record quarter for CareTrust on many fronts, carrying forward the momentum we've generated over the past few years. Year-to-date, we've deployed approximately $1.5 billion at a blended stabilized yield of roughly 8.7%. With a reloaded pipeline of $540 million, a fortress balance sheet, the team stronger than ever before, the opportunity set expanded, and great relationships with partners and new and existing high-quality operators, there has simply never been a more exciting time for CareTrust." Financial Results for Quarter Ended June 30, 2026 For the second quarter, CareTrust reported net income of $89.0 million, or $0.38 per diluted weighted-average common share, Normalized FFO of $119.7 million, or $0.51 per diluted weighted-average common share, and Normalized FAD of $118.5 million, or $0.51 per diluted weighted-average common share. Liquidity As of quarter end, CareTrust reported Net Debt-to-Annualized Normalized Run Rate EBITDA of 1.01x, and a net debt-to-enterprise value of approximately 5.4%. Derek Bunker, CareTrust's Chief Financial Officer, stated that as of today the Company has $595 million in borrowings outstanding on its $1.2 billion unsecured revolving credit facility, with no scheduled debt maturities prior to 2028, and approximately $785.8 million available for future issuances under the ATM Program. He also reported that CareTrust currently has approximately $90 million in cash on hand and $671 million in gross proceeds outstanding under unsettled equity forward contracts. Increased 2026 Guidance The Company provided updated guidance for 2026, projecting net income attributable to CareTrust of approximately $1.53 to $1.56 per share, Normalized FFO of approximately $2.03 to $2.06 per share, and Normalized FAD of approximately $2.01 to $2.04 per share. Mr. Bunker commented, "The midpoints of our new Normalized FFO and Normalized FAD guidance represent increases of 16.2% and 15.1%, respectively, over 2025 results. Our liquidity and capital access remain in great shape, giving us the flexibility to keep funding investments at our current pace. Between a balance sheet built for optionality and deep relationships across capital markets, we have real competitive advantages that provide runway to keep pursuing external growth aggressively." Mr. Bunker noted that full year 2026 guidance is based on a weighted average diluted share count of 233 million shares, and assumes the following: No new investments, loans, or dispositions beyond those made year-to-date; No new debt or equity issuances beyond those made year-to-date; 2.5% inflation-based rent escalators under long-term triple net leases; $147 million of loans to be fully repaid throughout the year; and No material change in the GBP:USD spot exchange rate. Dividend Maintained During the quarter, CareTrust declared a quarterly dividend of $0.39 per common share. On an annualized basis, the payout ratio was approximately 76% based on second quarter 2026 Normalized FFO, and 76% based on second quarter 2026 Normalized FAD. Conference Call A conference call will be held on Friday, August 7, 2026, at 11:00 a.m. Eastern Time (8:00 a.m. Pacific Time), during which CareTrust’s management will discuss second quarter 2026 results, recent developments and other matters. The toll-free dial-in number is 1 (833) 461-5787 or toll dial-in number is 1 (585) 542-9983 and the conference ID number is 615613867. The live audio webcast of the earnings conference call will be available on the Investors section of CareTrust’s website at investor.caretrustreit.com/events-and-presentations. To view any financial or other statistical information required by SEC Regulation G, please visit the Investors section of the CareTrust REIT website at http://investor.caretrustreit.com. This call will be recorded and will be available for replay via the website for 30 days following the call. About CareTrust™ CareTrust REIT, Inc. is a self-administered, publicly-traded real estate investment trust engaged in the ownership, acquisition, development and leasing of skilled nursing, seniors housing and other healthcare-related properties. With a portfolio of long-term net-leased properties spanning the United States and United Kingdom, and a growing portfolio of quality operators leasing them, CareTrust REIT is pursuing both external and organic growth opportunities across the United States and internationally. More information about CareTrust REIT is available at www.caretrustreit.com. Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This press release contains, and the related conference call will include, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical statements of fact and statements regarding the Company’s intent, belief or expectations, including, but not limited to, statements regarding the following: access to capital; investment activity; growth prospects; and operating and financial performance, including our fiscal year 2026 guidance and the assumptions set forth therein. Words such as "anticipate," "believe," "could," "expect," "estimate," "intend," "may," "plan," "seek," "should," "will," "would," and similar expressions, or the negative of these terms, are intended to identify such forward-looking statements. The Company’s forward-looking statements are based on management’s current expectations and beliefs, and are subject to a number of risks and uncertainties that could lead to actual results differing materially from those projected, forecasted or expected. Although the Company believes that the assumptions underlying the forward-looking statements are reasonable, the Company can give no assurance that its expectations will be attained. Factors which could have a material adverse effect on the Company’s operations and future prospects or which could cause actual results to differ materially from our expectations include, but are not limited to: (i) the ability of our tenants, managers, and borrowers to successfully operate our properties and to meet and/or perform their obligations under the agreements we have entered into with them, including without limitation, their respective obligations to indemnify, defend and hold us harmless from and against various claims, litigation and liabilities; (ii) the impact of unstable market and economic conditions; (iii) the impact of healthcare reform legislation, including reimbursement rates and potential minimum staffing level requirements, on the operating results and financial conditions of our tenants, managers, and borrowers; (iv) the consequences of bankruptcy, insolvency or financial deterioration of our tenants, managers and borrowers; (v) the ability and willingness of our tenants, managers and borrowers to renew their agreements with us, and our ability to reposition our properties on the same or better terms in the event of nonrenewal or in the event we replace an existing tenant or manager; (vi) the risk that we may have to incur impairment charges related to any asset sales if we are unable to sell such assets at the prices we expect; (vii) the impact of public health crises; (viii) the availability of and the ability to identify (a) tenants and managers who meet our credit and operating standards, and (b) suitable acquisition opportunities and the ability to acquire and lease the respective properties to such tenants and managers on favorable terms; (ix) the intended benefits of our acquisition of Care REIT plc ("Care REIT") may not be realized, and the additional risks we will be subject to from our investment in Care REIT and any other international investments; (x) the additional operational and legal risks associated with our properties managed in a RIDEA structure; (xi) the impact of the unfavorable resolution of litigation or disputes and rising liability and insurance costs as a result thereof or other market factors; (xii) the ability to retain our key management personnel; (xiii) the ability to maintain our status as a real estate investment trust ("REIT"); (xiv) changes in the U.S. and U.K. tax law and other state, federal or local laws, whether or not specific to REITs; (xv) the ability to generate sufficient cash flows to service our outstanding indebtedness; (xvi) access to debt and equity capital markets; (xvii) fluctuating interest and currency rates; (xviii) risks and challenges related to our use of, or inability to use, artificial intelligence; and (xix) any additional factors included under Item 1A "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2025 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2026, as such risk factors may be amended, supplemented or superseded from time to time by other reports we file with the Securities and Exchange Commission (the "SEC"). This press release and the related conference call provide information about the Company's financial results as of and for the quarter ended June 30, 2026 and is provided as of the date hereof, unless specifically stated otherwise. The Company expressly disclaims any obligation to update or revise any information in this press release or the related conference call (and replays thereof), including forward-looking statements, whether to reflect any change in the Company’s expectations, any change in events, conditions or circumstances, or otherwise. As used in this press release or the related conference call, unless the context requires otherwise, references to "CTRE," "CareTrust," "CareTrust REIT" or the "Company" refer to CareTrust REIT, Inc. and its consolidated subsidiaries. GAAP refers to generally accepted accounting principles in the United States of America. Non-GAAP Financial Measures EBITDA, Normalized EBITDA and Net Debt to Annualized Normalized Run Rate EBITDA. EBITDA attributable to CareTrust REIT, Inc. represents net income (loss) attributable to CareTrust REIT, Inc. before interest expense (including amortization of deferred financing costs), income tax expense, amortization of stock-based compensation, and depreciation and amortization. Normalized EBITDA attributable to CareTrust REIT, Inc. represents EBITDA attributable to CareTrust REIT, Inc. as further adjusted to eliminate the impact of certain items that the Company does not consider indicative of core operating performance, such as recovery of previously reversed rent, lease termination revenue, property operating expenses, gains or losses on foreign currency transactions, gains or losses from dispositions of real estate, real estate impairment charges, provision for loan losses, non-routine transaction costs, loss on extinguishment of debt, accelerated amortization of lease intangibles, net of noncontrolling interests' share, extraordinary incentive plan payment, write-off of deferred financing costs, unrealized gains or losses on other real estate related investments, provision for doubtful accounts and lease restructuring, qualifying retirement benefits, and other income and expenses, as applicable. EBITDA attributable to CareTrust REIT, Inc. and Normalized EBITDA attributable to CareTrust REIT, Inc. do not represent cash flows from operations or net income as defined by GAAP and should not be considered an alternative to those measures in evaluating the Company’s liquidity or operating performance. EBITDA attributable to CareTrust REIT, Inc. and Normalized EBITDA attributable to CareTrust REIT, Inc. do not purport to be indicative of cash available to fund future cash requirements, including the Company’s ability to fund capital expenditures or make payments on its indebtedness. Further, the Company’s computation of EBITDA and Normalized EBITDA may not be comparable to EBITDA and Normalized EBITDA reported by other REITs. The Company also discloses Net Debt to Annualized Normalized Run Rate EBITDA, which compares the Company's Net Debt as of the last day of the quarter to the Annualized Run Rate EBITDA attributable to CareTrust REIT, Inc. for the quarter. "Net Debt" is defined as the Company's Total Debt as of the last day of the specified quarter adjusted to exclude the Company's cash, cash equivalents, restricted cash and escrow deposits on acquisition of real estate as of such date, as well as the net proceeds from the expected settlement of shares sold under equity forward contracts through the Company's ATM Program and any forward equity offering that are outstanding as of such date. "Normalized Run Rate EBITDA" represents Normalized EBITDA, adjusted to give effect to the investments completed during the three months ended for the respective period as though such investments were completed as of the beginning of the period. "Annualized Normalized Run Rate EBITDA" is calculated as Normalized Run Rate EBITDA attributable to CareTrust REIT, Inc. for the specified quarter multiplied by four. Funds from Operations and Funds Available for Distribution. Funds from Operations ("FFO"), and Funds Available for Distribution ("FAD") are important non-GAAP supplemental measures of operating performance for a REIT. Because the historical cost accounting convention used for real estate assets requires straight-line depreciation except on land, such accounting presentation implies that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market and other conditions, presentations of operating results for a REIT that uses historical cost accounting for depreciation could be less informative. Thus, the National Association of Real Estate Investment Trusts ("Nareit") created FFO as a supplemental measure of operating performance for REITs that excludes historical cost depreciation and amortization, among other items, from net income, as defined by GAAP. FFO is defined by Nareit as net income computed in accordance with GAAP, excluding gains or losses from dispositions of real estate investments, real estate related depreciation and amortization and real estate impairment charges, adjustments for the share of consolidated joint ventures, and adjustments for unconsolidated partnerships and joint ventures. Noncontrolling interests' pro rata share information is prepared by applying noncontrolling interests' actual ownership percentage for the period and is intended to reflect noncontrolling interests' proportionate economic interest in the financial position and operating results of properties in our portfolio. The Company computes FFO attributable to CareTrust REIT, Inc. in accordance with Nareit’s definition. FAD attributable to CareTrust REIT, Inc. is defined as FFO attributable to CareTrust REIT, Inc. excluding noncash income and expenses, such as amortization of stock-based compensation, amortization of deferred financing fees, amortization of above and below market intangibles, amortization of lease incentives, the effects of straight-line rent, recurring capital expenditures required to maintain our properties, adjustments for the share of consolidated joint ventures and non-cash interest income. The Company considers FAD attributable to CareTrust REIT, Inc. to be a useful supplemental measure to evaluate the Company’s operating results excluding these income and expense items to help investors, analysts and other interested parties compare the operating performance of the Company between periods or as compared to other companies on a more consistent basis. Normalized FFO and Normalized FAD. The Company also reports normalized FFO ("Normalized FFO") attributable to CareTrust REIT, Inc. and normalized FAD ("Normalized FAD") attributable to CareTrust REIT, Inc., each of which adjust FFO and FAD, respectively, for certain revenue and expense items that the Company does not believe are indicative of its ongoing operating results, such as write-off of deferred financing costs, provision for loan losses, accelerated amortization of lease intangibles, net of noncontrolling interests' share, non-routine transaction costs, provision for doubtful accounts and lease restructuring, loss on extinguishment of debt, amortization of stock-based compensation related to extraordinary incentive plan, extraordinary incentive plan payment, unrealized gains or losses on other real estate related investments, gains or losses on foreign currency transactions, recovery of previously reversed rent, lease termination revenue, property operating expenses, qualifying retirement benefits and other income and expenses. By excluding these items, investors, analysts and our management can compare Normalized FFO and Normalized FAD between periods more consistently. Further, the Company’s computation of FFO, Normalized FFO, FAD and Normalized FAD may not be comparable to FFO, Normalized FFO, FAD and Normalized FAD reported by other REITs that do not define FFO in accordance with the current Nareit definition or that interpret the current Nareit definition or define FAD differently than the Company does. While FFO, Normalized FFO, FAD and Normalized FAD are relevant and widely-used measures of operating performance among REITs, they do not represent cash flows from operations or net income as defined by GAAP and should not be considered an alternative to those measures in evaluating the Company’s liquidity or operating performance. FFO, Normalized FFO, FAD and Normalized FAD do not purport to be indicative of cash available to fund future cash requirements. The Company believes that net income attributable to CareTrust REIT, Inc., as defined by GAAP, is the most appropriate earnings measure. The Company also believes that the use of EBITDA, Normalized EBITDA, FFO, Normalized FFO, FAD and Normalized FAD, combined with the required GAAP presentations, improves the understanding of operating results of REITs among investors and makes comparisons of operating results among such companies more meaningful. The Company considers EBITDA and Normalized EBITDA, in each case attributable to CareTrust REIT, Inc., useful in understanding the Company’s operating results independent of its capital structure, indebtedness and other charges that are not indicative of its ongoing results, thereby allowing for a more meaningful comparison of operating performance between periods and against other REITs. The Company considers FFO, Normalized FFO, FAD and Normalized FAD, in each case attributable to CareTrust REIT, Inc., to be useful measures for reviewing comparative operating and financial performance because, by excluding gains or losses from real estate dispositions, impairment charges and real estate related depreciation and amortization, and, for FAD and Normalized FAD, by excluding noncash income and expenses such as amortization of stock-based compensation, amortization of deferred financing fees, and the effects of straight-line rent, FFO, Normalized FFO, FAD and Normalized FAD can help investors compare the Company’s operating performance between periods and to other REITs. The Company believes that the disclosure of Net Debt to Annualized Normalized Run Rate EBITDA provides a useful measure to investors to evaluate the credit strength of the Company and its ability to service its debt obligations and to compare the Company’s credit strength to prior reporting periods and to other companies without the effect of charges that are not indicative of the Company’s ongoing performance or that could obscure the Company’s actual credit quality and after considering the effect of investments occurring during the period. View source version on businesswire.com: https://www.businesswire.com/news/home/20260805461295/en/ Contacts CareTrust REIT, Inc.(949) [email protected]

Interested in CareTrust REIT, Inc.? Here are five stocks we like better. CareTrust REIT posted strong first-quarter results, with normalized FFO up 38% year over year and normalized FFO per share up 14% to $0.48. Management also raised full-year 2026 guidance for both FFO and FAD. Investment activity accelerated sharply, with about $1.1 billion of year-to-date investments completed at a blended stabilized yield of roughly 8.9%. The mix included U.S. skilled nursing and senior housing, U.K. care homes, loans, and SHOP investments. The balance sheet remains very liquid and conservative, with no scheduled debt maturities before 2028, substantial revolver and ATM capacity, and net debt to EBITDA at just 0.6x. CareTrust also highlighted a Moody’s investment-grade upgrade and strong rent collection and portfolio coverage metrics. CareTrust REIT (NYSE:CTRE) reported a strong start to 2026, highlighting rapid investment activity, higher funds from operations and an increased full-year outlook during its first-quarter earnings call. President and CEO Dave Sedgwick said the company closed approximately $245 million of investments during the first quarter and accelerated its pace after quarter-end, closing 12 additional transactions for roughly $865 million since the start of April. Taken together, Chief Investment Officer James Callister said CareTrust has completed about $1.1 billion of year-to-date investments at a blended stabilized yield of approximately 8.9%. → Wells Fargo’s Comeback Is Real—But Not Risk-Free Sedgwick said the results reflected “a continuation of the momentum” the company has generated over the past several years. He pointed to year-over-year normalized FFO per share growth of 14%, a 16.4% dividend increase, an investment-grade upgrade from Moody’s and a higher 2026 FFO guidance range. Callister said first-quarter investment activity was anchored by a sale-leaseback of a six-property skilled nursing portfolio in the Mid-Atlantic, leased to an existing operator at a yield of about 9%. The quarter also included U.K. care home investments and a smaller loan secured by a skilled nursing facility operated by one of CareTrust’s existing operators. → Rocket Lab Posts Record Q1 Revenue, Raises Q2 Guidance Since April 1, the company closed 12 more transactions totaling about $865 million at a blended stabilized yield of approximately 8.9%. Callister said that activity was weighted toward U.S. skilled nursing and included an “opportunistic transaction” with a new operating relationship, as well as additional skilled nursing and senior housing triple-net investments, new and incremental loans, a second SHOP investment and more U.K. care home activity. Year-to-date investment volume includes: Approximately $705 million in U.S. skilled nursing or senior housing triple-net investments. Roughly $225 million in U.S. loans, primarily secured by skilled nursing facilities. Approximately $160 million in U.K. care homes. The remaining amount in SHOP investments. → The Great Crypto Thaw: Regulation Ignites an Infrastructure Boom Callister said CareTrust’s current investment pipeline is approximately $360 million. More than half of the pipeline is composed of U.K. care homes, about 20% is SHOP opportunities, and the remainder includes triple-net skilled nursing and senior housing investments, along with a small amount of loan activity. He noted that the company’s quoted pipeline includes only deals where it has a reasonable level of confidence it can “lock up and close within the next 12 months” and does not always include larger portfolios under review. CFO Derek Bunker said normalized FFO increased 38% from the prior-year quarter to $107.4 million, while normalized FAD rose 33% to $107.6 million. On a per-share basis, normalized FFO was $0.48, up 14%, and normalized FAD was also $0.48, up 12% from the same period a year earlier. CareTrust raised its 2026 full-year guidance to normalized FFO per share of $2.00 to $2.04 and normalized FAD per share of $1.98 to $2.02. Bunker said the midpoints of the updated ranges represent increases of 14.8% for normalized FFO and 13.6% for normalized FAD compared with 2025 results. The new guidance also represents increases from the initial 2026 guidance ranges issued in February. The guidance assumes no new investments, loans or dispositions beyond those already completed year-to-date; no new debt or equity issuances beyond those already completed; 2.5% inflation-based rent escalators under long-term triple-net leases; $145 million of loan repayments during the rest of the year; and no material change in the sterling-to-dollar exchange rate. Bunker said CareTrust settled $129.5 million of gross proceeds under its at-the-market forward program during the first quarter. After quarter-end, it settled the remaining outstanding forwards, bringing year-to-date settled forwards to roughly $493 million of gross proceeds to support investment activity. As of May 7, the company had $350 million drawn on its $1.2 billion unsecured revolving credit facility and approximately $70 million in cash. Bunker said CareTrust had no scheduled debt maturities before 2028, $850 million of availability on the revolving credit facility and about $879 million of capacity on its ATM program. Net debt to annualized normalized run-rate EBITDA was 0.6 times at quarter-end, below the company’s long-term target leverage range of 4 to 5 times. Net debt to enterprise value was approximately 3.6%. Bunker said the Moody’s investment-grade upgrade expands CareTrust’s access to debt capital and could support future growth. In response to an analyst question, he said an inaugural high-grade debt issuance is “certainly on our radar,” particularly as the company grows and begins to “pad out the balance sheet.” Sedgwick said CareTrust collected 100% of contractual rent and interest during the first quarter. He said overall EBITDAR rent coverage in the stabilized triple-net portfolio remained strong at 2.25 times, while EBITDARM coverage was 2.79 times. He also discussed preliminary results from a company study of publicly reported CMS outcomes in its skilled nursing portfolio. Sedgwick said the analysis focused on facilities that had been under lease for at least four years to allow time for star ratings to adjust under licensed operators. He said CareTrust tenants achieved higher overall CMS star ratings and higher health inspection star ratings compared with all for-profit operators. Compared with all operators, including for-profit and nonprofit operators, he said CareTrust tenants had higher quality measure star ratings, lower rehospitalization rates and higher successful discharge rates. On skilled nursing occupancy, Sedgwick said the sector has been on a “steady, modest” incline since bottoming in 2021. He said demographic trends are expected to become more significant in coming years, adding that while industry occupancy is in the low 80% range and CareTrust’s portfolio is around 80%, he expects the picture to be “dramatically different” five to seven years from now. During the question-and-answer session, analysts focused on competition in skilled nursing and SHOP investments, the company’s loan book and larger portfolio opportunities. Callister said the skilled nursing transaction market is predominantly off-market and relationship-driven. He said the market is less predictable than sectors with a steady flow of brokered deals, but CareTrust’s existing relationships have helped the company continue sourcing transactions. In SHOP, management said competition remains high and cap rates have continued to compress. Callister said primary-market Class A SHOP assets appear to have cap rates with “a 5 handle,” with rates moving higher from there depending on market and asset quality. He estimated cap rates have compressed by 50 basis points or more over the past six months. Sedgwick said building the SHOP platform has been somewhat surprising because of how aggressive some competitors’ underwriting has been. However, he said CareTrust’s ability to invest across three growth engines — SHOP, skilled nursing and U.K. care homes — gives the company flexibility and helps it maintain underwriting discipline. Regarding larger portfolio opportunities not included in the quoted pipeline, Sedgwick said the company typically excludes larger portfolios because some seller processes may not be certain to proceed. He said chunkier deals currently under evaluation are in the U.K. and U.S. skilled nursing markets, not SHOP. On the loan book, Sedgwick said CareTrust generally makes loans only when they include real estate acquisitions or when the company is confident the loan will lead to acquisitions. He also noted that some transactions classified as financing receivables are treated that way because of accounting rules related to purchase options, even though the company views them more like sale-leasebacks because the options are far in the future. CareTrust REIT, Inc is a real estate investment trust based in Deerfield Beach, Florida, specializing in the ownership, acquisition and management of net-leased healthcare properties. The company primarily focuses on seniors housing and post-acute care facilities, entering into long-term, triple-net lease agreements with leading operators in the skilled nursing, assisted living, memory care, inpatient rehabilitation and specialty hospital sectors. Through its portfolio, CareTrust REIT aims to provide investors with stable and predictable rental income while supporting the ongoing demand for quality healthcare real estate across the United States. Since its initial public offering in September 2013, CareTrust REIT has pursued a disciplined acquisition strategy, targeting properties in primary and select secondary markets. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "CareTrust REIT Q1 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for May 2026.

Image source: The Motley Fool. Friday, May 8, 2026 at 11 a.m. ET President & Chief Executive Officer — David M. Sedgwick Chief Investment Officer — James B. Callister Chief Financial Officer — Derek J. Bunker Need a quote from a Motley Fool analyst? Email [email protected] David M. Sedgwick: Thank you, Lauren, and good morning, everybody. Thanks for joining us. The first quarter was a strong start to the year and a continuation of the momentum we have been generating over the past several years. We closed approximately $245 million of investments in the first quarter, and the pace only accelerated from there. Since April, we have closed a dozen separate transactions for approximately $865 million. Just last Friday, on May 1, we closed three of those 12 deals that we have not yet had a chance to announce, including our second SHOP investment. James will provide color on some of the deals we have closed year-to-date and on the reloaded pipeline of $360 million. Our investments team continues to perform at a phenomenal level. What else can you say? I will just reinforce that SHOP is an important part of our growth story, and you should expect to see us continue to build that part of the portfolio with the same discipline and operator-centered approach we are known for. Deal flow continues to be active and interesting across SHOP, skilled nursing, and UK care homes. A quick acknowledgment to some of our unsung heroes here. Our accounting team proves every day to be the best pound-for-pound accounting team around. They have shouldered an enormous load onboarding a massive number of new assets and operators across the US and The UK while continuing to support the next wave of growth. Our asset management group continues to do great work curating a strong portfolio and de-risking it as we go. And every other function across the company—legal, tax, finance, operations, data analytics—shows up in a way that allows us to keep executing at a very high level and transforms a growing portfolio into a compounding portfolio. The results of the hard work and sacrifice of an extraordinary team produced year-over-year FFO per share growth of 14%, a 16.4% increase to the dividend, an upgrade to investment grade by Moody's, and a raise to our FFO per share guidance for the year that, at the midpoint, would be 14.8% higher than 2025. I think you can tell how I feel about my team. Let me talk for a second about our operators. Many of you know I am a recovery nursing home administrator. Several of us here have many years of experience inside the buildings. We have always hoped that our operating history and DNA would differentiate us in how, where, and with whom we build this portfolio. Our tenants continue to deliver for their employees, residents, patients, and communities. We have recently begun a meaningful study of publicly reported CMS outcomes in our skilled nursing portfolio compared to the rest of the sector. The preliminary findings show that skilled nursing operators who lease from CareTrust REIT, Inc. deliver care that is measurably better than the sector averages. With respect to the CareTrust REIT, Inc. facilities included in our analysis, we limited it to those facilities that have been under lease for at least four years to give adequate time for star ratings to adjust to the new licensed operators. We are specifically pleased to observe in our initial findings that, compared to all for-profit operators, our tenants achieve higher overall CMS star ratings and higher health inspection star ratings; and compared to all operators, for-profit and nonprofit, our tenants achieve higher quality measure star ratings, lower rehospitalization rates, and higher successful discharge rates. Now let us take a look at how that commitment to quality care translates to the financial health of our operators. Our overall EBITDAR rent coverage in our stabilized triple-net portfolio remains very strong at 2.25x, and EBITDARM coverage at 2.79x. Broad-based improvements throughout the portfolio continue. We collected 100% of contractual rent and interest in the first quarter, which speaks to the caliber of our tenants and borrowers. Putting it all together, we are in another extraordinary and busy period full of external growth and internal development, as we continue to refine our processes that enable a bigger and better CareTrust REIT, Inc. portfolio. As we continue to position ourselves with urgency to keep the flywheel going, we see steady deal flow across our three growth engines, and the team is firing on all cylinders. We could not be more excited about where we sit today or about what is still in front of us. With that, I will hand it off to James for a report on investment activity and the acquisition landscape. James? James B. Callister: Thanks, David. Good morning, everyone. During the first quarter, we completed approximately $245 million of investments at a blended stabilized yield of 8.8%. Q1 activity was anchored by a sale-leaseback of a six-property skilled nursing portfolio in the Mid-Atlantic leased to one of our quality operators at a yield of approximately 9%. Q1 also included a meaningful tranche of UK care home investments, and a small relationship-driven loan secured by a skilled nursing facility operated by one of our existing operators. Since April, we have closed an additional 12 transactions for approximately $865 million at a blended stabilized yield of approximately 8.9%. Activity was weighted toward U.S. skilled nursing, with a meaningful portion of that volume from an opportunistic transaction with a new operating relationship. The deal came together on a very compressed timeline, and the fact we got it closed is a real testament to the team's solutions-oriented approach and the deep relationships we have cultivated over many years. Beyond that anchor transaction, the period included: one, additional skilled nursing and senior housing triple-net investments with quality tenants across multiple geographies; two, a number of new and incremental loans either to existing operators or borrowers we have admired and desired to work with; three, our second SHOP investment to bring our total portfolio to four communities; and four, additional UK care home activity. We are particularly encouraged by the pace and size of our UK care home pipeline. Since the beginning of the year, we have continued to build momentum and have closed on investments in 10 care homes across the pond to add to our consistently growing portfolio. Putting Q1 and post-quarter activity together, year to date, we have closed approximately $1.1 billion of investments at a blended stabilized yield of approximately 8.9%. Of that total, approximately $705 million has been U.S. skilled nursing or senior housing triple-net; roughly $225 million has been U.S. loans, primarily secured by skilled nursing facilities and either closed concurrently with asset acquisitions or in anticipation of such; approximately $160 million has been UK care homes; and the remainder is SHOP. Our investment pipeline today sits at approximately $360 million. The composition is heavily UK care homes, which represents over half of the quoted pipeline, with another approximately 20% comprised of SHOP opportunities, and the remainder consisting of triple-net—both skilled nursing and seniors housing—and a small amount of loan activity. As always, please remember that when we quote our pipeline, we only include deals that we have a reasonable level of confidence we can lock up and close within the next twelve months, and it does not always include larger portfolios that we are reviewing. A quick note on the current transaction environment. The skilled nursing market remains active, supported by both brokered and proprietary opportunities. Current skilled nursing deal flow is more heavily weighted to off-market opportunities; thanks to our deep operator relationships and the strength of our existing portfolio, we are well positioned to continue pursuing skilled nursing transactions aggressively but with discipline. In The UK, our pipeline is ahead of schedule and growing. We are very pleased with how our London-based team continues to establish the CareTrust REIT, Inc. culture of “by operators, for operators.” That has expanded our ability to do more deals, meet new operators, and source opportunities through broker-marketed processes and direct relationships. We see meaningful upside there over time. In SHOP, while the market remains highly competitive and cap rates keep compressing, we are an active player and continue to see significant opportunity to grow that portfolio over the next several years with the right operators and the right assets. Our disciplined underwriting framework, combined with a strong focus on long-term operator relationships and a commitment to creative, collaborative transaction structuring, will continue to drive sustainable growth across the skilled nursing, senior housing, and UK care home sectors. With that, I will turn it over to Derek to review our quarterly financial results. Derek J. Bunker: Thanks, James. For the quarter, normalized FFO increased 38% over the prior-year quarter to $107.4 million, and normalized FAD increased 33% to $107.6 million. On a per-share basis, normalized FFO was $0.48, an increase of 14% over the prior-year quarter, and normalized FAD was also $0.48, an increase of 12% over the same period. Turning to the balance sheet and capital markets activity, during the first quarter, we settled $129.5 million of gross proceeds under our ATM forward program. Subsequent to quarter end, we settled the remaining outstanding forwards totaling [inaudible] million of forward equity contracts outstanding at March 31, bringing our year-to-date total settled forwards to roughly [inaudible] million of gross proceeds in support of our recent investment activity. As of May 7, we had $350 million drawn on our $1.2 billion unsecured revolving credit facility and approximately $70 million in cash on hand. We continue to have no scheduled debt maturities prior to 2028. As David mentioned, subsequent to quarter end, we also received an investment grade rating upgrade from Moody's. This recognition of our balance sheet strength and disciplined approach to capital structure further expands our access to debt capital and supports our ability to fund continued growth on attractive terms. In yesterday's press release, we raised our 2026 full-year guidance, projecting full-year normalized FFO per share of $[inaudible] to $[inaudible] and normalized FAD per share of $1.98 to $2.02. The midpoints of our updated normalized FFO and normalized FAD guidance represent increases of 14.8% and 13.6%, respectively, over 2025 results, and increases of 4.9% and 3.9%, respectively, compared to the initial 2026 guidance ranges we issued in February. The updated guidance is based on a weighted average diluted share count of 234 million shares and includes the following key assumptions: first, no new investments, loans, or dispositions beyond those made year to date; second, no new debt or equity issuances beyond those made year to date; third, 2.5% inflation-based rent escalators under our long-term triple-net leases; fourth, $145 million of loans to be fully repaid throughout the remainder of the year; and fifth, no material change in the sterling-to-dollar spot exchange rate. Additional guidance measures are detailed in the press release yesterday. Lastly, our liquidity continues to remain strong. As I mentioned, we have approximately $70 million of cash on hand, $850 million of availability under our revolving credit facility, and roughly $879 million of capacity on our ATM program. Net debt to annualized normalized run-rate EBITDA was 0.6x at quarter end, well below our long-term target leverage range of 4x to 5x, and net debt to enterprise value was approximately 3.6%. Aided by an investment grade credit profile, we have ample dry powder and multiple levers across our capital toolkit to continue funding our recent pace of investment activity. And with that, I will turn it back to David. David M. Sedgwick: Thanks, Derek. We hope that the report has been helpful. We appreciate all the interest and support. We would be happy to take your questions at this time. Operator: We will now open the call for questions. If you would like to ask a question, please press 1 on your telephone keypad. To withdraw your question, press 1 again. Please pick up your handset when asking a question. If you are muted locally, please remember to unmute your device. Please standby while we compile the Q&A roster. Your first question comes from Farrell Granath with Bank of America. Please go ahead. Farrell Granath: I want to dig in a little bit deeper on your comments about larger portfolio considerations that are not currently contemplated in guidance. Can you give a little detail on maybe some larger portfolios you were evaluating year to date that potentially you passed on and maybe why that would have happened? David M. Sedgwick: Well, when we quote our pipeline, as you know, we have the custom of not including larger portfolios that we are pursuing, because even though we may have a strong interest in them, sometimes they are fishing expeditions by the sellers and they may not be real. It is a lower probability of landing those, and a prime example is what just happened with this large deal in California. That was something that actually materialized very quickly that could not have been included in our previously quoted pipeline. So that is just our practice to not get too ahead of things. Sometimes the deals, either we decide to pass on them or they decide to go a different direction. Farrell Granath: Okay. Thank you. And also, in some of the previous earnings calls of peers, we have heard added commentary of increasing competition also in the SNF market—that it has been difficult to transact, less product is coming to the market, and also this larger increase in private capital. I am curious if you can add a little bit more color on the skilled nursing side—how you are able to source so many deals and maybe where you are sourcing them. James B. Callister: Sure, Farrell. This is James. I would say that the SNF market is, at this point, a predominantly off-market environment, if you will, and I think that it has, for a little while, been predominantly relationship-driven. It is a little bit more unpredictable because you are not getting a constant flow of broker deals like you are maybe in SHOP. But I think it has been like that for a while, and I think that the track record we have shows that relationships are just super important. You are typically not going to find a bread-and-butter sale-leaseback at a 9.5% yield with no creativity needed like you may have five years ago, but that has been the case for a while now. So I think it just takes increased creativity. It takes relationship-based deals, and you really have to rely on the off-market relationships in the SNF market today. And I think our track record shows that we have been doing that successfully. Farrell Granath: Great. Thank you so much. David M. Sedgwick: Thanks, Farrell. Operator: Your next question comes from Austin Todd Wurschmidt with KeyBanc Capital Markets. Please go ahead. Austin Todd Wurschmidt: Hi. Good morning, everybody. David or Derek, with the dual investment grade rating and continued improvement in your long-term cost of capital, how do you think of the benefit of achieving this goal, and then utilizing that for maybe some strategic opportunities or even the flexibility it gives for your ability to source even some of the larger portfolios from time to time? Derek J. Bunker: Hey, Austin. I think you hit it in your question there. We have been fortunate to have strong access and support from capital markets to really underwrite and pursue a lot of our activity. With the added benefit of the upgrade from Moody's recently, it only gives us more optionality and expands our access, I think deeper, if we do decide to do an inaugural issuance in the high-grade market. That is certainly on our radar, especially as we grow and start to pad out the balance sheet a little bit. We are excited about it. We really like what we see in the pipeline and beyond just for the next several years, so having that option—we are really excited about it. Austin Todd Wurschmidt: And maybe David or James, within SHOP, you have talked a lot about the competition of the investment landscape. What has been your hit rate on deals that you have bid on? And are off-market opportunities, as you continue to develop even more relationships similar to what you referenced in skilled, the best way to grow that portfolio? What is the current process and strategy to continue to build that out within that segment? James B. Callister: Yeah, Austin, you make a really good point. In SHOP right now, given the amount of competition, if we do get an off-market deal or some other in or unique relationship on a deal that comes through, we are going to prioritize that, see if it works, and make a more heavy run at it. As far as hit rate, it is a small percentage of deals that we see come across the desk that we decide to bid on, and a smaller percentage that we decide to really push and start to stretch a little bit. For the deals that we really push and stretch, I do not know the exact hit rate—it is a competitive market right now. Given the cost of capital we have and the access to capital, if we really decide we want the deal and it fits for us and we are going to stretch, there is a pretty good chance we are going to be in the last one or two and hopefully get it. But overall, it is a pretty low hit rate just given the number of deals that are coming across right now, and much of that low hit rate is based on the fact that we do not elect to pursue most of what comes across the desk. Austin Todd Wurschmidt: And then just lastly, how much would you say cap rates have compressed since you really started to evaluate transactions? James B. Callister: In SHOP, if we are talking about rate compression, it is hard to put an exact number on it. There is a range in SHOP between class A in a primary market versus the best few buildings in a secondary or tertiary market. Right now, it feels like class A in a primary market is going to have a five handle on it, and you go up the range from there. I would say in the last six months, cap rates have probably compressed 50 bps or more. David M. Sedgwick: Thanks, Austin. Operator: Your next question comes from Juan Sanabria with BMO Capital Markets. Please go ahead. Juan Sanabria: Hi. Good morning. I was hoping you could talk a little bit about the loan book. It has grown as a preponderance of the transactions that you did in the first quarter when including the financing receivables. How big are you comfortable with that getting, and can you give color on some of the loans you did? Any options for the operators to buy back the real estate we should be thinking about, or just generally more color on those investments? David M. Sedgwick: Juan, this is David. Our strategy with respect to lending was really established a few years ago and has been a key determinant for the explosive growth that we have had. The key feature of that strategy is that we will only do loans if they include real estate acquisitions or we are confident that they will lead to real estate acquisitions, and the activity that you have seen recently fits and checks those boxes. The real estate that we have acquired came with some loans that were necessary to get the deals done. Even on the financing receivable side, it is a little bit misleading because it is more of an accounting rule that causes what we consider a sale-leaseback to be accounted for as a financing receivable because of the purchase options. But because those purchase options are so far out—nine or ten years—we view that much more as a sale-leaseback. Technically, it will look like the loan book has grown more than it really will feel like it for the next ten years. Juan Sanabria: Great. And then just curious on seniors housing on the SHOP side—how you are thinking about what markets you are looking to target and the type of assets, whether they are core, core-plus, value-add. Where do you think there is the best opportunity for the company? James B. Callister: We are still pretty agnostic on market. We want primary, secondary, and some tertiary, but we are going to look at it on a deal-by-deal basis and pursue it opportunistically. We want to underwrite to a low double-digit IRR, and we see a lot of paths to get there. Not every deal has the same path, so we do not have one box it has to fit. We look at each deal and ask: what is this deal’s path to a low double-digit IRR, and do we have confidence in that path? If we do, we will make a run at it; if we do not, we will pass. That path is different if you are in a primary market than if you are in secondary or tertiary. Typically, we want to be in one of the one, two, maybe three best facilities in a market. We want an operator that is a regional sharpshooter with experience in that area, that has reporting capabilities to help us on the SHOP side, and that has a proven track record in that market of success. Those are the parameters around where we are pursuing deals in SHOP right now. Operator: Your next question comes from Michael Carroll with RBC Capital Markets. Please go ahead. Michael Albert Carroll: Thanks. James, I wanted to talk a little bit more about valuation across property types. SHOP cap rates have come in. What about skilled nursing facilities and the UK care homes? Have those markets been any more competitive over the past few quarters, and how are you thinking about the competitive landscape there? James B. Callister: In skilled nursing, I do not feel like it has changed that much in the past year. You have a lot of family office and fierce competition. It is fewer buyers in the U.S. SNF side, but it is the same groups. We see the same players on really every deal. So there is still a lot of competition, but it is the same players. I have not seen cap rates change much—maybe a little bit. We have had to, for bigger deals, go below a 9% yield on the lease to get the deal if it is big enough and the right operator. In The UK, there is a little bit of increased competition, but for product we are looking at, yields are still going to be in the mid-8s for us. That is pretty typical. It is more like a seniors housing asset over there, so that is pretty typical for seniors housing triple-net deals here. We like that kind of yield and basis. So, yes, there is maybe a little uptick in competition in The UK, but nothing comparable to the uptick in SHOP competition you see here. Michael Albert Carroll: And then can you provide us some details on the recent SHOP deal? Is that with a relationship operator that you could grow with, and was it in a primary or secondary market? How should we think about that specific transaction? James B. Callister: Prescott, Arizona was done with a relationship operator we have known for a long time. This is the first deal with them, but we have known them for a very long time. We have sought to do deals with them for a long time. They are the current operator in the building. We had a great relationship with the seller—we have been buying buildings from them for the last few years and hope to continue to buy buildings from them in the future. It is about 110 units of assisted living. The going-in estimated year-one yield is going to be in the 8s. We like the market, we like this operator, and we would like to grow with them and think that we will. We like the path to get us to that low double-digit IRR. It is a pretty stable asset, so it is not in lease-up or another turnaround situation. It is really just making some tweaks to optimize the performance a bit to get us to that low double-digit IRR. Michael Albert Carroll: Lastly, Derek, can you talk about CareTrust REIT, Inc.'s desire to enter the debt markets? Should we think about another bond being pound-denominated to naturally hedge some of your UK exposure, or more U.S. dollar–denominated debt? Derek J. Bunker: Thanks, Mike. If we do something this year—and we are exploring that option pretty deeply—you will see it denominated in USD. We are conscious and aware of our exposure to the pound sterling, and we really like our current program. It is going very well, and paired with the pipeline, which has been growing consistently and exceeding our expectations a bit due to the team there, we feel like we are sort of naturally hedged a little bit in terms of buying pounds and being short dollars. Given the pricing differential, we will continue to put things on our balance sheet here and keep it denominated in USD as we explore it. Operator: Your next question comes from Michael Goldsmith with UBS. Please go ahead. Analyst: Yeah, thanks. This is Justin Hospik on for Michael Goldsmith. I noticed that occupancy in your skilled nursing portfolio was up in Q4 2025. Is that primarily due to recently acquired properties, and how do you feel occupancy will trend this year? If pre-COVID SNF occupancy was roughly 80%, does the demographic tailwind push that number up significantly over the coming years? David M. Sedgwick: Skilled nursing has been on a steady, modest incline since it bottomed out in 2021. It is difficult to say one quarter versus the other exactly what happened across the portfolio of our size, but the direction of travel, we believe, will continue to be what it has been. The difference in the coming years is that it is going to start ramping up significantly. The demographics are inevitable, and that is part of the basis for the SHOP and skilled nursing excitement and investment by institutional investors. While we are in the 80% range in our portfolio today, five to seven years from now, I think it is going to be dramatically different. Analyst: Great. And then last one for me. Can you walk through the increase in the guidance for G&A, and the changes in interest income and interest expense as well? Derek J. Bunker: The increase in G&A is almost entirely due to hitting key KPIs for STI given our performance and guide for FFO and investment spend to date. We started with a modest accrual and are catching up. We are also continuing to build out the team a little bit to support overall growth across the organization, rounding out the team coming off a couple years of growth. Interest income and expense is moving around in part because of us drawing down the revolver this quarter to date to fund the acquisitions, and our guidance does not incorporate the pipeline or future acquisitions—it is a snapshot running out the interest income and interest expense. David M. Sedgwick: Thanks, Justin. Operator: Your next question comes from Richard Anderson with Cantor Fitzgerald. Please go ahead. Richard Anderson: Hey, thanks. Good morning. Are you finding that building out your SHOP platform is proving to be more challenging than perhaps you thought going in? Back at NAREIT when you made your first SHOP deal, it seemed like momentum would build quickly. It has been a little slow, perhaps to your credit that you are not growing for the sake of growth. Are you surprised by how tough it is to move the needle in building the SHOP platform while some peers are pacing themselves faster? David M. Sedgwick: On some level, it has been a little bit surprising—not so much that it has been competitive, because we knew as we were entering it that it is a very competitive scene. One of the surprises has been to see how aggressive some of our competitors’ underwriting has been. Even for deals that, like James talked about, we really like and stretch for, we sometimes get beat by folks that do not have the cost of capital that we do. I think it may speak a little bit, Richard, to us being agnostic across three growth engines. We have not painted ourselves into a corner with respect to having to do SHOP or feeling compelled to put money to work there. That really is our advantage because we have the freedom to maintain the discipline that we have built the CareTrust REIT, Inc. portfolio on. We are pleased with what we have done so far. I think we will continue to grow it, and over time it will become meaningful, and our confidence in the deals that we do get is very high. Richard Anderson: When you talk about larger portfolio deals not included in the $360 million pipeline, are there any larger SHOP deals in that universe? David M. Sedgwick: No, I do not think so. The chunkier deals we are evaluating right now are in The UK and U.S. SNF. Richard Anderson: OHI has talked about applying RIDEA to their UK business. Is that on the table for you, or are you too new there at this juncture? David M. Sedgwick: I think there will be a time when that opportunity presents itself for us, and we should be ready to do that. Richard Anderson: Thanks very much. Operator: Your next question comes from Michael Stroyeck with Green Street. Please go ahead. Michael Stroyeck: Thanks, and good morning. Now that there has been some time since the original Care REIT acquisition, how is that portfolio performing relative to expectations, and where does EBITDAR coverage on that initial deal sit today? David M. Sedgwick: It is an appropriate question for today because today marks the one-year anniversary of us closing that deal. In most cases, it is ahead of schedule. Importantly, the team that we inherited there—we are very pleased with the quality of that team and their openness, acceptance, and adoption of us, becoming truly a CareTrust REIT, Inc. arm in The UK. That is important because all the success that we have throughout the organization is really based on the culture and the people that we have in the company, and that is what has produced the results. I thought if we could do in 2026 a couple hundred million dollars of new investments in The UK, that would be great. Remember when we acquired Care, their pipeline was basically starting from a standing start because they had a real restriction to access to capital before we acquired them. To see the amount of acquisitions that we have done and the pipeline continue to build as it has is really good. With respect to lease coverage, it continues to be phenomenally high, particularly when you think about what these assets are. These are really senior housing assets. In the United States, back when triple-net seniors housing deals were still getting done, lease coverages would be about 1.1x or somewhere around there. We are much higher than that—closer to 1.75x to 1.8x, north of 2.0x on an EBITDA basis. To have that type of security on senior housing properties is a really strong foundation from which to grow. Michael Stroyeck: Understood. And then going back to the debt discussion, with that investment grade rating from Moody's, what sort of rate do you think you could issue at today? Derek J. Bunker: I would love to signal exactly what it would be, but broadly, if we are doing a ten-year, you are probably looking at a 130 to 140 basis points spread. Michael Stroyeck: Great. Thanks. Operator: Your next question comes from Wesley Golladay with Baird. Please go ahead. Wesley Golladay: Good morning, everyone. I want to go back to the comment about better CMS outcomes. I imagine your background helps you work with the operators, and there is also probably a component of identifying a good operator out of the gate. How transferable is that skill set to The UK and to U.S. SHOP? David M. Sedgwick: The skill of identifying, vetting, and selecting quality operators is definitely transferable, although I am not sure that skill set needs to be transferred to the team there because they evidently already had it, as evidenced by the very strong lease coverage and the quality operators that we were able to inherit. We are really pleased, by and large, with the operators that they selected there before we got there, and we feel like we are definitely in sync as we evaluate new operators for The UK. Wesley Golladay: Alright. Thank you. David M. Sedgwick: Thanks, Wes. Operator: Your next question comes from Vikram Malhotra with Mizuho. Please go ahead. Analyst: Hi, thank you. This is Jody on behalf of Vikram. For the new operator you have in the sale-leaseback transaction, is there an opportunity to grow that relationship by the Genesis assets? And second, what is your view on sustained double-digit FAD growth from here? James B. Callister: I will take the first part. The Genesis bankruptcy does not have much, if any, real estate in it, really. So it is probably yet to be determined if we grow with that operator based on those assets. There is certainly nothing in discussion at the current time. We will definitely look to grow with them in other asset bases and other deals that we bring them or they bring us. We really like them, so we look forward to growing with them moving forward. Analyst: And on sustained double-digit FAD growth? Derek J. Bunker: I will take that one. We are really pleased and excited about both the progress we have made on our investments and our integration as well as the outlook. As David mentioned in his prepared remarks, we do not plan on slowing down. We are still extremely bullish about all three of our growth segments, and it is really up to us to execute on that. Operator: There are no further questions at this time. I will now turn the call back to David M. Sedgwick for closing remarks. David M. Sedgwick: I really appreciate everybody's time, questions, and interest. I appreciate our board, our shareholders, especially our team here and operators who make it all happen. If you have further questions, you know where to find us. Have a great weekend. Operator: This concludes today's call. Thank you for attending. You may now disconnect. Before you buy stock in CareTrust REIT, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and CareTrust REIT wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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