Target Healthcare REIT (LSE: THRL)

Last close As at 17/07/2024


−1.60 (−1.97%)

Market capitalisation


Target Healthcare REIT invests in modern, purpose-built residential care homes in the UK let on long leases to high-quality care providers. It selects assets according to local demographics and intends to pay increasing dividends underpinned by structural growth in demand for care.

The care home sector is driven by demographics rather than the economy, generating a positive demand outlook for new, ESG-compliant, purpose-built homes with flexible layouts and high-quality residential facilities. With its unwavering focus on asset and tenant quality, these are the homes in which Target invests. It believes best-in-class assets, in areas with strong demand/supply characteristics, and sustainable rent levels will always be attractive to existing or alternative tenants and are key to providing sustainable, long-duration income with capital growth.

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Real Estate

Equity Analyst

Martyn King

Martyn King

Director, Financials

Key Management

  • Alison Fyfe


  • Gordon Bland


  • Kenneth MacKenzie


Balance Sheet

Forecast net debt (£m)


Forecast gearing ratio (%)


Share Price Performance

Price Performance
% 1M 3M 12M
Actual 0.1 5.4 6.4
Relative (1.0) 0.4 (4.3)
52 week high/low 88.0p/66.5p


Target Healthcare’s (THRL’s) Q324 update shows a fifth successive quarter of positive NAV total return, with indexed rent reviews driving increased earnings and property values. Tenant profitability remains strong, with rent cover stable at 1.9x, the highest level since IPO in 2013. Rent collection is robust at more than 98%. Dividend cover was 1.1x in Q3 and is 1.08x year to date. Q324 NAV per share increased 2.2% to 109.0p and NAV total return was 3.6% (8.3% ytd). Reflecting strong investor demand for high-quality assets, the tight yield spread over funding costs is frustrating THRL’s ambitions to grow its portfolio, but a strong, liquid balance sheet positions it well for a change in market conditions.

Y/E Jun Revenue (£m) EBITDA (£m) PBT (£m) EPS (p) P/E (x) P/CF (x)
2022A 63.9 N/A 30.2 5.0 15.9 15.9
2023A 67.7 N/A 37.2 6.0 13.3 16.5
2024E 69.1 N/A 37.8 6.1 13.0 13.0
2025E 73.3 N/A 38.7 6.2 12.8 12.3



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