What’s Up DOC?

 In Free Articles, Healthcare

Summary

  • I’m here today to share with you a real hunter and rabbit story, and actually more of a tortoise and the hare scenario.
  • DOC is well positioned in 2018 with very little short-term debt, as the company termed out its short term debt with the 10 year publicly-traded bonds in December 2017.
  • DOC maintains exceptional credit profile despite rapid growth.
  • DOC is now yielding 6.2% and I consider that highly attractive, especially when you consider the enhanced credit quality of DOC’s portfolio.
  • I am UPGRADING DOC from a BUY to a STRONG BUY.

What’s Up Doc? Is a Looney Tunes cartoon that was released by Warner Brothers Pictures in 1950 to celebrate Bugs Bunny’s 10th birthday that year. I’m sure many of you know the story: Bugs and Elmer Fudd are the classic duo of the Hunter versus the Hare, here the trailer…

Source: YouTube durece100

OK. Enough for the cartoons, I’m here today to share with you a real hunter and rabbit story, and actually more of a tortoise and the hare scenario.

As you can see below, shares in Physicians Realty (DOC) have been scorched year-to-date, dropping by just under 17% YTD, compared with ~11% for the Vanguard Real Estate ETF (VNQ):

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Keep in mind, I have been a customer of DOC for quite some time, I flashed my BUY sign up over four years ago as I explained that “DOC seems fit and I’m satisfied that this Health Care REIT will benefit from the prospects and outperformance generated by strong external growth.”

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As you can see, DOC was a top-performer (for me) in 2016, however, shares under-performed in late 2017 and year-to-date 2018. Oddly, DOC has under-performed many other high-quality REITs also in 2018 and now that year-end results are in the rear-view mirror, it’s definitely time for a checkup, hence the title to my article (of course I love Bugs Bunny too), “What’s Up DOC?”

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