CareTrust REIT, Inc. Q1 FY2026 earnings call

• The first quarter was a strong start with approximately $245 million of investments closed, and since April, another $865 million of transactions have been closed. - The investments team has performed phenomenally. The shop is an important part of the growth story. - The accounting, asset management, and other functions across the company have contributed to high - level execution. - Operators' tenants deliver good care, with skilled nursing operators leasing from Care Trust having better CMS outcomes. - Overall EBITDAR rent coverage in the stabilized triple net portfolio is strong, and 100% of contractual rent and interest was collected in the first quarter.

During the first quarter, the company completed approximately $245 million of investments at a blended stabilized yield of 8.8%. Year - to - date, it has closed approximately $1.1 billion of investments at a blended stabilized yield of approximately 8.9%. Of this total, approximately $705 million has been U.S. skilled nursing or senior housing triple net. Roughly $225 million has been U.S. loans, primarily secured by skilled nursing facilities. Approximately $160 million has been U.K. care homes, and the remainder is shops. The stabilized triple net portfolio has very strong EBITDAR rent coverage at 2.25 times and EBITDARM coverage at 2.79 times.

• Raised 2026 full year guidance, projecting full year normalized FFO per share of $2 to $2.04, and normalized FAD per share of $1.98 to $2.02. - The midpoints of updated normalized FFO and normalized FAD guidance represent increases of 14.8% and 13.6% respectively over 2025 results and increases of 4.9% and 3.9% respectively compared to initial 2026 guidance ranges. - Guidance is based on assumptions like no new investments, loans, or dispositions beyond those made year to date, no new debt or equity issuances beyond those made year to date, 2.5% inflation - based rent escalators, $145 million of loans to be fully repaid throughout the remainder of the year, and no material change in the sterling to dollar spot exchange rate.

Forward looking statements are subject to risks and uncertainties that could cause actual results to materially differ from expectations. These risks are discussed in Care Trust REIT's most recent Form 10 - Q filing with the SEC.

Q: Farrell Granite with Bank of America asked about larger portfolio considerations not in guidance, with James and Dave responding about not including larger portfolios as they may be fishing expeditions or lower probability of landing, and about SNF market being off - market and relationship - driven.

A: When we put our pipe, we don't include larger portfolios that we're pursuing because they may be fishing expeditions by sellers with lower probability of landing. In the SNF market, it's predominantly off - market and relationship - driven.

Q: Austin Werschman with KeyBank Capital Markets asked about dual investment grade rating benefit and SHOP deal hit rate, with Derek and James responding about increased access to debt capital and SHOP deal hit rate being low with most deals not pursued.

A: The upgrade from Moody's gives more optionality and access to debt capital. In SHOP, it's a competitive market with low hit rate as most deals are not pursued.

Q: Juan Sanabria with BMO Capital Markets asked about loan book and shop market, with Dave and James responding about loan strategy and SHOP market targeting.

A: Loan strategy is to do loans with real estate acquisitions or confidence in leading to them. In SHOP, we're agnostic, look deal - by - deal for low double - digit IRR.

Q: Michael Carroll with RBC Capital Markets asked about valuations in portfolios and recent SHOP deal, with James responding about skilled nursing and UK care homes valuations and details of recent SHOP deal.

A: Skilled nursing market has fierce competition with same players, UK care homes have a little increased competition. The recent SHOP deal is in Prescott, Arizona with a known operator.

Q: Michael Goldsmith with UBS asked about occupancy in skilled nursing portfolio and GNA guidance, with Dave responding about occupancy trend and GNA increase.

A: Skilled nursing occupancy has been inclining and will ramp up with demographics. GNA increase is due to hitting KPIs and building out the team.

Q: Rich Anderson with Cantor Fitzgerald asked about SHOP platform challenge and larger portfolio deals, with Dave responding about SHOP platform being competitive but with discipline and no larger SHOP deals in the $360 million pipeline.

A: SHOP platform is competitive but we maintain discipline. There are no larger SHOP deals in the $360 million pipeline.

Q: Michael Stroyek with Green Street asked about CARE REIT acquisition portfolio performance and debt issuance rate, with Dave responding about CARE REIT acquisition portfolio performing ahead of schedule and debt issuance rate around 130 - 140 base point spread for 10 - year.

A: CARE REIT acquisition portfolio is ahead of schedule. Debt issuance for 10 - year is likely around 130 - 140 base point spread.

Q: Wes Galladay with Baird asked about CMS outcomes transferability, with Dave responding about skill of identifying operators is transferable.

A: The skill of identifying, vetting, and selecting quality operators is transferable to UK and US shops.

Q: Vikram Milotra with Mizuho asked about new operator relationship and sustained double - digit FAD growth, with Dave and Derek responding about new operator relationship and bullish outlook.

A: There's no current discussion on growing with the new operator based on Genesis assets. We're bullish on all three growth segments and will execute to achieve sustained growth.