2 High-Performing, High-Yield Medical Dividend Stocks to Buy Now
Higher interest rates are generally not good for real estate investment trusts (REITS), as they have to pay more for financing, which can cut into their profit margins. However, Omega Healthcare Investors (NYSE: OHI) and Sabra Health Care REIT (NASDAQ: SBRA), two REITs with exposure to skilled nursing and assisted-care facilities, are beating the market this year, with the S&P 500 down more than 18%.
On top of that, each offers a dividend with a yield of 8% or more. While skilled nursing facilities took a big hit during the pandemic, because of reduced occupancy rates and higher labor cost amid staffing shortages, the long-term outlook for such facilities, and the REITS that specialize in them, is strong because the global population is aging. According to the U.S. Census Bureau, since 1950, the number of people over age 65 has grown from 8% of the population to 16.9% today. While many of those turning 65 or older may want to age in place, that's not always possible. By 2030, all baby boomers will be 65 or older and many of them will need to be in assisted living centers or other senior housing.
Omega Healthcare's shares are up almost 7% this year. The company specializes in skilled nursing facilities, with 921 facilities rented to 63 tenants in 42 states and the U.K., as of June 30. The COVID-19 pandemic was especially hard on Omega's tenants, but as its net income returns to form, Omega Healthcare's business is looking healthier.
Source Fool.com
