Omega Healthcare 2025-26: $1.1B Deployed, AFFO $3.15-$3.25 FY26

FY25 revenue $1.20B (+14%); op income $749M (+14%); NI $590M (+45%); EPS $1.94 (+25%). FCF $879M (+23%). Q4 revenue $319M (vs $279M Q4 FY24). Q4 adjusted funds from operations (AFFO) $250M / $0.80/share; FAD $238M / $0.76/share. Q4 dividend payout ratio 84% AFFO / 88% FAD. Full year 2025 AFFO + FAD growth exceeded 8% YoY, driven in part by $1.1B+ capital deployment including RIDEA transactions in US senior housing + UK care homes. Investments in 1,111 facilities (62% skilled nursing + transitional care + 38% US senior housing + UK care homes). Core portfolio operator EBITDAR coverage 1.57x as of September 30, 2025. Genesis filed Chapter 11 bankruptcy — coverage remains strong, second auction result ongoing. Expanded Sabra relationship; committed capital in Canada; delevered balance sheet. Total debt $4.26B (-12% YoY); dividends $780M (+14%). FY26 guide: full-year AFFO $3.15-$3.25/share; $157M mortgages + other real estate loans repaid in 2026; $196M non-real estate backed loans repaid (including $137M Genesis loans); $15-$25M/quarter asset sales; assumes new investments through February 4 + scheduled loan repayments + potential asset sales.

Key takeaways

• $1.1B+ capital deployment in 2025 — meaningful acceleration vs prior years; RIDEA + Sabra + Canada expansion. Omega Healthcare deployed >$1.1B in new investments during 2025 — well above the multi-year run-rate. The deployment included (a) RIDEA (Real Estate Investment Diversification Election Act) transactions in US senior housing + UK care homes, (b) expanded relationship with Sabra Health Care REIT (joint ventures + investments), (c) committed capital in Canada (new geographic expansion). RIDEA structures are particularly important because they enable Omega to participate in operating profits + losses (vs traditional triple-net lease structures that just collect rent), creating higher-return potential albeit with operating risk exposure.

• Core portfolio EBITDAR coverage 1.57x — operator credit health solid. Core portfolio operator EBITDAR coverage of 1.57x at September 30, 2025 (latest disclosed) means operators are generating EBITDAR at 1.57x rent obligations — comfortable margin of safety. Coverage above 1.5x is generally considered healthy for skilled nursing operators. The coverage held despite Genesis Chapter 11 bankruptcy because Genesis was already a known credit issue + Omega's other tenants are performing well. Multi-year operator credit rebuild post-COVID staffing pressures.

• Genesis Chapter 11 bankruptcy — managed exit; second auction underway. Genesis HealthCare (longstanding Omega tenant) filed Chapter 11 bankruptcy in 2025. Management explicitly noted "coverage remains strong" and "bankruptcy process is ongoing with a second auction result." Omega's $137M Genesis loans being repaid in 2026 is part of the resolution. The Genesis bankruptcy is the cleanest example of legacy operator credit issues being worked through — Omega has been managing this exposure for several years and the resolution clears the deck for FY26-27.

• AFFO $3.15-$3.25 FY26 guide; AFFO + FAD growth >8% FY25 — sustained mid-single-digit dividend coverage. From FY25 implied AFFO/share ~$2.95 (4 quarters × $0.74 average) → FY26 midpoint $3.20 = ~+8% growth. AFFO + FAD growth of >8% in FY25 is materially above peer healthcare REITs. Combined with dividend payout ratio of 84% AFFO / 88% FAD, the dividend coverage is solid. Multi-year dividend stability + selective growth via $1.1B deployment.

• Skilled nursing 62% / Senior housing + UK care 38% — multi-segment + multi-region diversification. Omega's portfolio composition (62% SNF + transitional care + 38% senior housing + UK care homes) provides multi-segment diversification. The 38% senior housing exposure (via RIDEA structures) creates upside from senior housing recovery + occupancy growth + RevPOR (revenue per occupied room) expansion. UK care homes provide currency + regulatory diversification.

Business

Omega Healthcare Investors, Inc. is a leading healthcare REIT focused on skilled nursing + senior housing + UK care homes:

• Skilled Nursing + Transitional Care (~62% of facilities): US skilled nursing facilities (SNF) + post-acute care + long-term care + transitional care. Largest US SNF REIT. Multi-tenant operator base.
• US Senior Housing (~25% of facilities): Independent living + assisted living + memory care. RIDEA + traditional NNN structures.
• UK Care Homes (~13% of facilities): UK senior care + dementia care. RIDEA structures.
• Mortgages + Loans: Multi-year mortgage + loan portfolio to operators. $137M Genesis loans being repaid 2026.

Strategic moves FY25:

• $1.1B+ new investments (RIDEA + acquisitions)
• Genesis Chapter 11 bankruptcy management
• Sabra relationship expansion
• Canada capital commitment (new geography)
• Delevered balance sheet ($4.26B debt -12% YoY)
• AFFO + FAD growth >8% YoY
• Dividend $780M (+14%)
• Core portfolio EBITDAR coverage 1.57x

FY25 financial performance

The earnings progression: revenue grew steadily from $878M (FY22) to $1.20B (FY25, +36% over 3 years). Op margin expanded from 44.7% (FY22) to 62.6% (FY25). EPS recovered from $1.00 (FY23 trough) to $1.94 (FY25). FCF $879M (+23% YoY).

Total debt $4.26B (-12% YoY) — multi-year deleveraging continues. Dividend $780M (+14%) — multi-year progressive REIT dividend.

Capital allocation

• Capex: $0 FY25 (REIT structure; capex inside tenant operations).
• Dividends: $-780M FY25 (+14% YoY).
• Buybacks: $0 (no buyback program).
• Total debt: $4.26B (-12% YoY) — multi-year deleveraging.
• FCF: $879M FY25 (+23% YoY).
• FY25 deployment: $1.1B+ new investments.

FY26 outlook (per Q4 2025 call, 2026-02-05)

Management noted continued operator credit monitoring, Genesis bankruptcy resolution, RIDEA portfolio performance, Sabra expansion, Canada deployment.

Key risks

Skilled nursing operator credit risk. Multi-tenant SNF operator credit health is the dominant ongoing risk. Genesis Chapter 11 is the latest example; LaVie + Maplewood + others under pressure historically.

Medicare + Medicaid reimbursement. SNF operators heavily dependent on Medicare + Medicaid reimbursement. CMS rate updates + state Medicaid programs matter.

Healthcare labor environment. SNF + senior housing operators face multi-year labor cost inflation + nurse + CNA staffing shortages.

Senior housing occupancy + RIDEA performance. RIDEA portfolio exposes Omega to operating profits + losses. Occupancy + RevPOR + opex management all matter.

UK care home + FX dynamics. UK exposure creates GBP/USD translation + UK regulatory + Brexit dynamics.

Interest rate environment. Multi-year refinancing of $4.26B debt sensitive to rate environment.

REIT competitive landscape. Welltower, Ventas, Healthpeak, Sabra, CareTrust, LTC Properties, Diversified Healthcare Trust, Healthcare Realty all compete.

Property valuation marks. Multi-year property valuation impairments possible if operator credit deteriorates.

ACA + premium tax credit dynamics. Senior housing + SNF coverage indirectly affected by ACA exchange enrollment.

Pandemic + public health emergency. Multi-year COVID legacy + future pandemic risk affects SNF + senior housing operations.

Asset sales pricing. Multi-year asset sales need accretive pricing.

Operator restructuring activity. Tenant restructurings (lease modifications + bankruptcy + asset transitions) create multi-year complexity.

Site-neutral payment proposals. Medicare site-neutral payment proposals could affect SNF + post-acute economics.

Bond market access. Healthcare REIT bond market dynamics + spread environment.

Bottom line

Omega Healthcare Investors FY25 is the deployment acceleration + tenant credit resolution year: revenue $1.20B (+14%); op income $749M (+14%); NI $590M (+45%); EPS $1.94 (+25%). FCF $879M (+23%). Q4 revenue $319M (vs $279M FY24). Q4 AFFO $250M / $0.80/share; FAD $238M / $0.76/share. Q4 dividend payout 84% AFFO / 88% FAD. FY25 AFFO + FAD growth >8% YoY. $1.1B+ new investments deployed (RIDEA US senior housing + UK + Sabra expansion + Canada commitment). 1,111 facilities (62% SNF + 38% senior housing + UK). Core portfolio EBITDAR coverage 1.57x (9/30/25). Genesis Chapter 11 bankruptcy managed (second auction underway). Total debt $4.26B (-12% YoY). Dividend $780M (+14%).

FY26 guide: AFFO/share $3.15-$3.25 (~+8% midpoint vs FY25 ~$2.95). $157M mortgages + other real estate loans repaid; $196M non-real estate loans repaid ($137M Genesis); $15-$25M quarterly asset sales.

The risks are real — skilled nursing operator credit risk, Medicare + Medicaid reimbursement, healthcare labor environment, senior housing occupancy + RIDEA performance, UK care home + FX dynamics, interest rate environment, REIT competitive landscape (Welltower, Ventas, Healthpeak, Sabra, CareTrust, LTC, Diversified Healthcare, Healthcare Realty), property valuation marks, ACA + premium tax credit dynamics, pandemic + public health emergency, asset sales pricing, operator restructuring activity, site-neutral payment proposals, bond market access.

But the structural thesis (leading healthcare REIT + 1,111 facilities + 62% skilled nursing + transitional care + 38% US senior housing + UK care homes + $1.1B+ FY25 capital deployment + RIDEA US + UK + Sabra expansion + Canada commitment + AFFO + FAD growth >8% FY25 + core portfolio EBITDAR coverage 1.57x + multi-year deleveraging $4.26B (-12% YoY) + dividend $780M (+14%) + Genesis bankruptcy resolution underway + FY26 AFFO $3.15-$3.25/share) is intact and FY25 confirms.

Quality healthcare REIT compounder mid-recovery, with multi-segment platform + skilled nursing concentration + senior housing diversification + UK care home + RIDEA optionality + multi-year capital deployment + operator credit stabilization + multi-year deleveraging + dividend progression + Sabra expansion + Canada new geography. The FY25 +14% revenue + +25% EPS + AFFO + FAD growth >8% + $1.1B+ deployment + RIDEA expansion + EBITDAR coverage 1.57x + Genesis resolution + multi-year deleveraging + dividend +14% + FY26 AFFO $3.15-$3.25 creates one of the cleaner healthcare REIT compounding setups for investors seeking exposure to skilled nursing + senior housing + UK care + RIDEA optionality + multi-year capital deployment + dividend stability. The conservative FY26 framework + multi-year capital deployment + RIDEA portfolio + Genesis resolution + multi-year deleveraging + dividend progression + new geographic expansion provides multiple paths to outperformance over a multi-year horizon. Operator credit + reimbursement + labor + RIDEA performance + interest rate environment remain ongoing risks, but the multi-segment diversification + multi-region + RIDEA optionality + capital deployment + deleveraging + dividend stability support continued compounding through cycles.

Citations

• Omega Healthcare Investors, Inc. FY25 Form 10-K (filed February 2026, SEC EDGAR).
• OHI Q4 2025 earnings call, 2026-02-05 — Investments in 1,111 facilities (62% skilled nursing + transitional care; 38% US senior housing + UK care homes); Q4 revenue $319M (vs $279M Q4 FY24); Q4 AFFO $250M / $0.80/share; Q4 FAD $238M / $0.76/share; Q4 dividend payout ratio 84% AFFO / 88% FAD; FY 2025 AFFO + FAD growth exceeded 8% YoY; $1.1B+ in capital deployment FY25 including RIDEA transactions in US senior housing + UK care homes; Genesis filed Chapter 11 bankruptcy (coverage remains strong; second auction result); expanded Sabra relationship; committed capital in Canada; delevered balance sheet; core portfolio operator EBITDAR coverage 1.57x as of September 30, 2025. FY26 guide: AFFO $3.15-$3.25/share; $157M mortgages + other real estate loans repaid in 2026; $196M non-real estate backed loans repaid (including $137M Genesis loans); $15-$25M per quarter in asset sales; assumes new investments completed as of February 4 + scheduled loan repayments + potential asset sales.
• OHI Q3 / Q2 / Q1 2025 earnings calls — supporting operator credit + capital deployment + Genesis trajectory.
• Internal financial_statements view (consolidated annual + cash flow + capital structure).