National Health Investors (NHI) Q3 2024 earnings summary

Executive summary

• Q3 2024 net income per diluted share was $0.65, down from $0.68 year-over-year, with nine-month net income per share at $2.17, down from $2.39.

• SHOP occupancy reached 88.6%, up 960 bps year-over-year and 160 bps sequentially, supporting NOI growth of 30.4% year-over-year to $3.0 million.

• Over $205 million in investments closed year-to-date, including a $121 million acquisition of the Spring Arbor portfolio, the largest since 2020.

• Liquidity at September 30, 2024, was $881 million, including $381 million revolver capacity and $500 million ATM; net debt to adjusted EBITDA at 4.4x.

• Industry tailwinds include low inventory growth, historic lows in new starts, and favorable demographics supporting long-term growth.

Financial highlights

• Net income per diluted share for Q3 2024 was $0.65, down from $0.68 year-over-year; NAREIT and normalized FFO per diluted share decreased to $1.03 from $1.08.

• FAD for Q3 2024 was $49.4 million, up 2.5% year-over-year; nine-month FAD up 8.3% to $152.1 million.

• SHOP NOI rose 30.4% year-over-year and 2.5% sequentially; year-to-date SHOP NOI up 40.9%.

• Rental income increased 1.7% year-over-year to $63.3 million, driven by new investments.

• Return on Invested Capital (ROIC) reached 8.29% in Q3 2024, exceeding the weighted average cost of capital.

Outlook and guidance

• 2024 NAREIT FFO per diluted share guidance revised to $4.39–$4.41; Normalized FFO to $4.43–$4.44.

• 2024 Normalized FAD guidance increased to $201.8M–$202.5M.

• SHOP NOI growth guidance tightened to 28%–30% for the year.

• Guidance reflects lower lease revenue, interest income, and a $3.6M non-cash credit loss reserve, partially offset by acquisitions.

• Expectation to return to normal rent/income levels for transitioned SLM properties in the second half of 2025.