Boenning & Scattergood Initiates a Hold Rating on Global Medical REIT


In a report released today, Matthew Schultheis from Boenning & Scattergood initiated coverage with a Hold rating on Global Medical REIT (NYSE: GMRE). The company’s shares closed yesterday at $9.

Schultheis said:

“We are initiating coverage of Global Medical REIT with a Neutral rating. Since coming public in 2016, the company has paid a quarterly dividend of $0.20 per share, which it has not covered from adjusted funds from operations. The problem is that acquisition cap rates were too low to support the dividend declared until common equity was levered at ratios that modestly exceed the peer group average, and that acquisition volumes were slow in the initial quarters of operations. We calculate that if the company acquires an incremental $125 million of properties at a 7.9% cap rate in 2018, the dividend and $3 million of tenant improvement obligations will be funded by AFFO. Currently, the company is primarily leveraging its common and preferred equity with a floating rate credit facility, making it vulnerable to rising rates.”

According to TipRanks.com, Schultheis is a 4-star analyst with an average return of 10.2% and a 79.7% success rate. Schultheis covers the Financial sector, focusing on stocks such as Orrstown Financial Services Inc, Citizens Financial Services Inc, and Provident Financial Services.

Global Medical REIT has an analyst consensus of Moderate Buy, with a price target consensus of $10.

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Based on Global Medical REIT’s latest earnings release for the quarter ending March 31, the company reported a quarterly net profit of $1.87 million. In comparison, last year the company had a GAAP net loss of $622.8K.

Based on the recent corporate insider activity of 7 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of GMRE in relation to earlier this year.

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Global Medical REIT, Inc. operates as a development stage company that intends to develop and manage a portfolio of healthcare real estate assets and properties. The company was founded on March 18, 2011 and is headquartered in Bethesda, MD.

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