Welltower Stock Rises 28.9% Year to Date: Will the Trend Last?

Shares of Welltower WELL have gained 28.9% in the year-to-date period, outperforming the industry’s upside of 1.7%.

Welltower owns a well-diversified portfolio of healthcare real estate assets in the key markets of the United States, Canada and the U.K. Given an aging population and an expected rise in senior citizens’ healthcare expenditure, the company’s senior housing operating (SHO) segment is well-poised to benefit from this positive trend. Portfolio-repositioning efforts and a healthy balance sheet bode well.

Last month, the company reported a second-quarter 2025 normalized FFO per share of $1.28, surpassing the Zacks Consensus Estimate of $1.22. The reported figure improved 21.9% year over year.

Results reflected a rise in revenues on a year-over-year basis. The total portfolio same-store net operating income (SSNOI) surged year over year, driven by SSNOI growth in the SHO portfolio. The company increased its guidance for 2025 normalized FFO per share.

Analysts seem positive on this healthcare REIT, currently carrying a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for its 2025 FFO per share has been revised marginally northward to $5.06 over the past week.

Factors Behind WELL’s Stock Price Rise

The senior citizens’ population is expected to rise in the years ahead. As a result, the national healthcare expenditure by senior citizens, who constitute a major customer base of healthcare services, is likely to increase in the upcoming period. Muted new supply has also been a tailwind for this industry. Capitalizing on these positive aspects, WELL’s SHO portfolio is well-prepared for compelling multiyear revenue growth. The second quarter of 2025 marked the 11th consecutive quarter in which year-over-year SHO SSNOI growth exceeded 20%.

Welltower remains focused on improving its SHO portfolio through the addition of strategic properties and the recycling of capital through dispositions. With these prudent capital-allocation measures, the company has improved its SHO portfolio operator diversification and expanded geographic footprint in high-barrier-to-entry urban markets. From the beginning of the year through July 28, 2025, Welltower carried out pro-rata acquisitions and loan funding totaling $2.08 billion for 78 SHO properties.

Historically, there has been a favorable outpatient visit trend compared with inpatient admissions. Banking on this, the company is optimizing its OM portfolio, growing relationships with health system partners and deploying capital in strategic acquisitions. Given the favorable secular trends and growing need for value-based care, the company’s efforts to strengthen its OM footprint will boost long-term growth.

Welltower has been actively banking on its growth opportunities through acquisitions. In March 2025, Welltower announced that it is under contract to acquire the Amica Senior Lifestyles portfolio from Ontario Teachers' Pension Plan for C$4.6 billion. In February 2025, Welltower acquired 48 skilled nursing facilities for $990.9 million, which were leased to Aspire Healthcare under a long-term triple-net master lease.

Welltower has a healthy balance sheet position and ample liquidity to meet near-term obligations and fund its development pipeline. As of June 30, 2025, it had $9.5 billion of available liquidity, including $4.5 billion of cash & restricted cash and full capacity under its $5 billion line of credit. As of June 30, 2025, the net debt to adjusted EBITDA was 2.93X, improving from 3.68X year over year. Moreover, Welltower’s debt maturities are well-laddered, with a weighted average maturity of 5.8 years, enhancing its financial flexibility.

Key Risks for WELL

A competitive landscape in the senior housing market and tenant concentration in its triple-net portfolio are likely to weigh on Welltower.

Stocks to Consider

Some better-ranked stocks from the broader REIT sector are Host Hotels & Resorts (HST) and Terreno Realty (TRNO), each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

The Zacks Consensus Estimate for HST’s 2025 FFO per share is pegged at $1.95, suggesting a year-over-year decrease of 1%.

The consensus estimate for TRNO’s 2025 FFO per share stands at $2.61, indicating an increase of 7.9% year over year.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.

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This article originally published on Zacks Investment Research (zacks.com).

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