Treasure Chest: HealthCo Healthcare & Wellness REIT

This story features HEALTHCO HEALTHCARE & WELLNESS REIT, and other companies. For more info SHARE ANALYSIS: HCW

FNArena's Treasure Chest reports on money making ideas from stockbrokers and other experts.

Whose Idea Is It?

Analysts at Goldman Sachs

The subject:

Goldman Sachs initiated coverage on HealthCo Healthcare & Wellness REIT ((HCW)) with a Buy rating and the recently listed REIT (September) went straight to the broker's Conviction List.

The maiden price target of $2.56 implies a total return for the year ahead in excess of 20% with the broker pointing out its expectation is for an average total return for the sector of circa 6% in Australia.

FNArena's consensus forecasts, which are based on projections published by stockbrokers Morgans and Morgan Stanley, imply the forward looking yield at the current share price is 3.4% and 4.2% respectively for this financial year and FY23.

More info:

HealthCo Healthcare & Wellness REIT is the latest initiative of the team of property specialists that made its mark with Home Consortium ((HMC)) and HomeCo Daily Needs REIT ((HDN)), both highly successful ventures that have paid off in spades for early shareholders that gave entrepreneurship two thumbs up.

The HealthCo Healthcare & Wellness REIT owns a portfolio of healthcare and wellness assets, all in Australia and predominantly concentrated on the eastern seaboard. As such, it is seen as a relatively defensive proposition with secure cash flows and high-quality, stable tenants, often with government backing, but the healthcare sector is also growing steadily, and irrespectively of interest rates and the economic cycle, so this proposition is not only about security and stability.

Analysts at Goldman Sachs believe the REIT is supported by sub-sector mega-trends, such as the ongoing ageing of the Australian population, the ongoing increases in spending by governments on healthcare services, plus technological improvements and more and more demand for healthcare services.

The two brokers in the FNArena universe of seven daily monitored stockbrokers who also cover the stock, Morgans and Morgan Stanley, are equally positive with ratings of Add and Overweight and price targets of respectively $2.48 and $2.45.

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