Where does Omega Healthcare Investors rank after its 2% announced dividend increase?

ohi

Omega Healthcare Investors Incorporated (OHI), a REIT company, announced a regular quarterly dividend of $0.61, a 2 percent increase from the prior rate of $0.60 per share. The dividend will be paid at the new higher rate on November 15, 2016, to shareholders of record at close of business on October 31, 2016. Omega Healthcare Investors Inc. is currently priced at $33.22.

Listed in the table below are the quarterly dividend payments since 2010. Our analysis of Omega Healthcare Investors Inc. as a Top 100 Dividend Stock candidate is listed below;

Date Quarterly Dividend
10/31/2016 0.61
7/28/2016 0.6
4/28/2016 0.58
1/29/2016 0.57
10/29/2015 0.56
7/29/2015 0.55
4/28/2015 0.18
3/27/2015 0.36
1/29/2015 0.53
10/29/2014 0.52
7/29/2014 0.51
4/28/2014 0.5
1/29/2014 0.49
10/29/2013 0.48
7/29/2013 0.47
4/26/2013 0.46
1/29/2013 0.45
10/31/2012 0.44
7/27/2012 0.42
4/26/2012 0.42
1/27/2012 0.41
10/27/2011 0.4
7/28/2011 0.4
4/27/2011 0.38
1/27/2011 0.37
10/27/2010 0.37
7/28/2010 0.36
4/28/2010 0.32
1/27/2010 0.32

Analysis of Omega Healthcare Investors Inc., a REIT, is based upon our five key criteria for the Top 100 list, which include; 

Category Value Score
Dividend Yield 7.34% 11
Dividend Growth (3-6 year avg) 8.9% 242
Forward P/E & FFO 9.59 20
S&P Financial Rating BBB- 240
Beta 0.7 25
Total Score   538

Additional Information;

% Yield 3 Year Div. Growth Rate 6 Year Div. Growth Rate
FFO

2016

FFO

Ratio

10 yr

FFO

Ratio Low

10 yr

FFO

Ratio High

5 yr max Yield % 5 yr lowest Yield %
7.34% 8.3% 9.5% 3.25 10.3 8.43 13.05 8.91% 4.54%

Final Analysis;

  • Omega Healthcare’s dividend yield is above the average of the S&P 500 Index and is trading above its average historical dividend yield.
  • Omega Healthcare maintains a 3 year dividend growth rate of 8.3%.
  • Omega Healthcare has paid out a dividend consecutively for the past 24 years.
  • Omega Healthcare is trading at a low forward P/E ratio and at reasonable FFO ratio.  From a relative valuation perspective based upon P/BV, Omega Healthcare is moderately undervalued.
  • Omega Healthcare maintains a credit rating of BBB-. This is investment grade, but at the lower end.
  • Omega Healthcare maintains a beta of 0.70, lower than the average company.

Based upon its poor financial rating and median FFO ratio , Omega Healthcare Investors does not qualify as one of our Top 100 Dividend Stocks.

Omega Healthcare Investors Inc. Dividend Yield Chart (Click to enlarge) ohi

Chart Explanation:  Dividend growth stocks may be viewed favorably when the current yield is above historical readings for the past 5 years.

Further information on dividend investing and evaluating dividend growth candidates can be found at http://seekingalpha.com/author/timothy-mcintosh/articles

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