KeyBanc Reiterates Sector Weight Rating on Global Medical REIT (GMRE)

KeyBanc analyst Jordan Sadler reiterated a Sector Weight rating and {REMOVEPT} price target on Global Medical REIT (NYSE: GMRE).

The analyst commented, "This morning, GMRE announced it has re-leased the majority of space vacated by Steward Health Care (2.8% of ABR as of 1Q24, or pre-bankruptcy) to CHRISTUS Health, which backfills $2.9M of the $3.1M of ABR leased to Steward prior to its bankruptcy filing in May 2024. The timing and economics of the lease commencement at its Beaumont, TX, facility appear in line to slightly better than our expectation and reduce the risk to our 2025 earnings estimate and consensus. The Company is putting minimal capital into this facility, with initial cash rent slightly above Steward’s contractual amount, and at higher, fixed annual escalators. While the Company remains focused on backfilling vacant space and managing its lease expiration schedule, management continues to explore external growth opportunities. However, the Company remains limited in its ability to grow earnings and accretively deploy capital given its existing cost of capital but is evaluating capital recycling and other potential financing options (e.g., OP units) that will be accretive to earnings and contain leverage within its targeted range of 40-45% debt to gross asset value vs. 43.8% as of 2Q24. Accordingly, we reiterate our SW-rating."

For an analyst ratings summary and ratings history on Global Medical REIT click here. For more ratings news on Global Medical REIT click here.

Shares of Global Medical REIT closed at $10.15 yesterday.

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