The Community Health Care Fund (CHCT) came in with quarterly funds from operations (FFO) of $0.63 per share, beating Zacks Consensus’s estimate of $0.59 per share. That compares to an FFO of $0.59 a share a year ago. These numbers are adjusted for non-recurring items.

This quarterly report is a surprise FFO of 6.78%. A quarter ago, this REIT was expected to generate an FFO of $0.59 per share when it actually produces an FFO of $0.62, yielding a surprise 5.08%.

Over the past four quarters, the company has exceeded consensus FFO estimates three times.

Community Health Care FundWhich belongs to Zacks REIT and Equity Trust – another industry, reported revenue of $24.81 million for the quarter ending September 2022, topping Zacks’ consensus estimate by 1.15%. This compares to last year’s revenue of $23.25 million. The company has topped its consensus revenue estimates twice over the past four quarters.

The sustainability of the stock’s immediate price action based on recently released numbers and future FFO expectations will depend mostly on management’s comment on the earnings call.

Community Healthcare Trust shares have lost about 26.8% year-to-date against the S&P 500’s -18.8% decline.

What’s next for a community health care fund?

While the Community Healthcare Trust has underperformed the market so far this year, the question on investors’ minds is: What’s next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company’s view of FFO. This includes not only the current combined FFO forecast for the upcoming quarter(s), but also how those forecasts have changed recently.

Empirical research shows a strong relationship between near-term stock movements and trends in rating reviews. Investors can track these reviews themselves or rely on a tried and tested rating tool like Zacks Rank, which has a proven track record of leveraging the power of discretionary reviews.

Ahead of this earnings announcement, the direction of the Community Healthcare Trust’s discretionary reviews: mixed. While the volume and direction of discretionary revisions can change after the company’s just released earnings report, the current situation translates to Zacks Rank #3 (Hold) for the stock. Therefore, the shares are expected to perform in line with the market in the near future. You can see the full list of Zacks #1 stocks (strong buy) today here.

It will be interesting to see how the estimates for the upcoming quarters and the current fiscal year change in the coming days. The current agreed estimate of FFO is $0.61 on $25.08 million in revenue for the next quarter and $2.45 on $97.77 million in revenue for the current fiscal year.

Investors should be aware of the fact that the outlook for the industry can have a material impact on the stock’s performance as well. In terms of the Zacks Industry ranking, REIT and Equity Trust – Other are currently in the bottom 43% of the 250 plus Zacks industries. Our research shows that the top 50% of industries ranked by Zacks outperform the bottom 50% by a factor of more than 2 to 1.

Another stock from the same industry, Physicians Realty Trust (DOC), is yet to report results for the quarter ending September 2022. Results are expected on November 3.

This healthcare REIT is expected to report quarterly earnings of $0.27 per share in its upcoming report, which represents a +3.9% year-over-year change. Our consolidated earnings per share estimate for the quarter was revised down 0.4% over the past 30 days to the current level.

Physicians Realty Trust is expected to generate $132.15 million in revenue, an increase of 14.6% over the same quarter last year.

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Community Healthcare Trust Incorporated (CHCT): Free Stock Analysis Report

Physicians Realty Trust (DOC): Free Stock Analysis Report

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The opinions and opinions expressed here are those of the author and do not necessarily reflect the views and opinions of Nasdaq, Inc.

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