This Super REIT is Undervalued Right Now

Canadian stocks have broadly been battered over the past two weeks. The S&P/TSX Composite Index was down 145 points in mid-afternoon trading on September 22. If it holds, this would be the third triple digit decline over the past four trading sessions. Today, I want to zero-in on a discounted real estate investment trust (REIT) that is worth snatching up today.

The Northwest Healthcare REIT (TSX:NWH.UN) owns and operates a global portfolio of high-quality health care real estate. Shares of this REIT have dropped 15% in 2022 at the time of this writing. That has pushed the REIT into negative territory in the year-over-year period.

This company unveiled its second quarter fiscal 2022 earnings on August 11. It delivered revenue growth of 24% to $111 million in Q2 2022. Meanwhile, it posted strong portfolio occupancy of 97%. Northwest now has assets under management worth $10.2 billion – up 22% from the prior year. Moreover, net asset value (NAV) per unit increased 8% from Q2 2021 to $14.19. Net operating income rose to $88.8 million compared to $69.8 million in the second quarter of fiscal 2021. Adjusted funds from operations (AFFO) jumped to $46.8 million over $43.2 million.

Shares of this REIT currently possess a very favourable price-to-earnings ratio of 6.1. Better yet, it offers a monthly dividend of $0.067 per shar. That represents a monster 6.9% yield.