Wait For A Drop Before Buying This 7.6% Yielding Healthcare REIT

Real estate investment trusts are very appealing income vehicles. They provide investors with a steady monthly or quarterly dividend paycheck, independent of the market environment, or state of the economy (at least for the most part). Since investors had more than enough reasons in 2016 to flee to safety and buy REITs (oil price crash, fear of energy-related debt defaults in the financial and BDC sectors, Brexit referendum), REIT prices have increased gradually from the early year lows.

One healthcare REIT I'd definitely consider buying on a drop is Care Capital Properties, Inc. (NYSE:CCP). Care Capital Properties said that it expects its normalized FFO to clock in between $2.85-$2.95/share this year, which implies that the REIT's shares are selling for ~10.3x 2016e normalized FFO. What's more, CCP is now WAY overbought, further putting the REIT's investors at risk of a pullback.

Source: Seeking Alpha

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