What can past earnings surprises tell us about WELL's future?

Welltower's (WELL) past earnings surprises, along with its strategic initiatives and market trends, suggest a positive outlook for the company's future performance:

1. Consistent Growth: WELL has demonstrated a strong growth trajectory, with a significant total shareholder return of 381.98% over the last five years. This consistent growth indicates a robust business model and the company's ability to capitalize on market opportunities.
2. Earnings Growth: The company's earnings have shown a notable increase, with a 17% rise in normalized funds from operations (FFO) per share in the second quarter of 2024, primarily driven by its Senior Housing portfolio. This growth in FFO is a key indicator of the company's operational success and its ability to generate income from its properties.
3. Strategic Investments: WELL's aggressive investment strategy has led to approximately $5 billion in acquisitions year-to-date, mainly in the Senior Housing sector in the US and UK. These strategic investments are likely to contribute to the company's future growth as these assets become operational and generate revenue.
4. Market Confidence: The company's stock has soared to an all-time high, reaching $125.55 and later $144.88, reflecting market confidence in WELL's performance. This confidence is likely a result of the company's strong earnings, strategic investments, and consistent dividend payments.
5. Analyst Optimism: Analysts from Deutsche Bank, Morgan Stanley, and RBC Capital have expressed confidence in WELL's growth trajectory, particularly in the Senior Housing sector. These positive analyst ratings and price target adjustments suggest that the company's future prospects are viewed favorably.
6. Dividend Stability: WELL has a track record of consistent dividend payments, with a current dividend yield of 1.87%. The company's affirmation of a $0.67 cash dividend demonstrates confidence in its financial outlook and provides an additional return for investors.

In conclusion, WELL's past earnings surprises, combined with its strategic investments, market confidence, and analyst optimism, suggest a positive outlook for the company's future performance. Investors can expect continued growth, driven by the company's strong operational performance and strategic initiatives.