Sabra Health Care REIT, Inc. (SBRA) Stock Analysis
Sabra’s 13.7% SHOP NOI growth, 4.61x leverage, and 13.1x forward FFO multiple create a compelling value-and-re-rating opportunity despite transition and labor risks.
Overview
Sabra Health Care REIT is a self-managed healthcare REIT owning specialized real estate across skilled nursing, senior housing, behavioral health, and specialty hospitals in the United States and Canada. Its cash flows combine stable triple-net rent with higher-growth SHOP revenue, and the company is deliberately increasing SHOP exposure toward **40% of gross assets and NOI by the end of 2026**. Q2 2026 demonstrated operating momentum: revenue rose 24.7% to $235.9 million, resident fees and services increased 63.1% to $128.8 million, same-store managed Cash NOI grew 13.7%, and occupancy rose 170 basis points to 88.2%. The $(25.2) million GAAP loss and $(0.10) EPS were distorted by a $102.4 million non-cash RCA loan-loss provision; Normalized AFFO was $0.40 per share, above the $0.30 dividend. RCA still generated $200.0 million of cash, reducing leverage to 4.61x and leaving approximately $1.3 billion of liquidity. Management reiterated 2026 Normalized FFO guidance of $1.53-$1.55 and AFFO guidance of $1.59-$1.61. At 13.1x forward FFO versus a 15.5x peer median, the stock offers re-rating potential; the average 12-month target is $22.57, while the report’s five-year probability-weighted target is $27.33.