Real Estate Investment Trust (REIT) stocks are having a rough year as interest rates remains at an elevated level. Government bond yields have risen to near 5% and the Fed has hinted that it will deliver just two rate cuts this year.
The Vanguard Real Estate ETF(VNQ) has dropped by almost 8% from its December highs. Let’s explore some of the top REIT stocks that are soaring this year.
Medical Properties Trust (MPW)
Medical Properties Trust, one of the most troubled REITs in the US, is one of the best performers this year as investors anticipate a turnaround. MPW has soared by over 36% from its lowest level this year, and is hovering at its highest level since November last year.
Medical Properties Trust faced the challenge as its biggest tenant and a portfolio company collapsed into bankruptcy last year.
MPW stock has jumped after the management priced in $1.5 billion and 1 billion euro senior notes to boost its balance sheet. The stock has jumped above the 50-day and 200-day moving averages, pointing to more gains ahead.
Cherry Hill Mortgage Investment (CHMI)
Cherry Hill Mortgage Investment is another top-performing REIT stock this year. It has jumped by over 20% this year, and by 40% from its lowest point in November last year.
CHMI is a top company that acquires, invests, and manages residential houses across the country. The stock has jumped after the company made some major changes to its business.
For example, it terminated the management agreement with Cherry Hill Mortgage Management as part of it internalization process. This change helped it to become a fully integrated mortgage REIT, helping it to reduce expenses.
Cherry Hill Mortgage Investment stock has also jumped above the 50-day and 200-day weighted moving average, while the ADX has moved to 25. That is a sign that the stock will continue rising this year.
Diversified Healthcare Trust (DHC)
Diversified Healthcare Trust is another top-performing REIT stock this year as it soared to $2.60, its highest level since December 3. DHC is a top REIT that competes with Medical Properties Trust in the US.
The company owns properties in the healthcare industry worth $7.2 billion. It owns properties like hospitals and those in the life sciences industry. Its stock has continued rising even as some analysts have expressed concerns about its debt and cash flow issues. It is also making losses, with its third-quarter net loss being $98.6 million. Its revenue came in at $373 million, up slightly from $371 million a year earlier.
Annaly Capital Management (NLY)
Annaly Capital Management stock is up by over 15% this year as investors rushed to its 12% yield. Most of this rally happened after the company published strong financial results. Its net income rose to 78 cents a share, as its total portfolio jumped to $80.9 billion.
Annaly has benefited from its diversified strategy, made up of its agency, residential credit, and mortgage servicing rights. Each of these businesses did well during the year.
Other REIT stocks
The other notable top-performing REIT stocks this year are Prologis, Terreno Realty, Innovative Industrial Properties, and WellTower.
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