Omega Healthcare Investors Inc. Common Stock (OHI)

FairStock Score: 73/100 — STEADY

Key Financials

Strengths

• Generates $760 million in annual free cash flow (5.4% yield on market cap)
• Solid return on equity of 12.0% above cost of capital
• Healthy net profit margin of 13.9% showing consistent profitability
• Attractive 6.0% dividend yield providing steady income returns
• FairStock composite score of 73/100 places it in the top tier across value, quality, and momentum factors

Concerns

• Trades significantly above Graham Number ($28) with negative 66% margin of safety—limited downside protection
• Altman Z-Score of 1.6 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Omega Healthcare Investors Inc. Common Stock is a mid-cap real estate company valued at $14.0 billion. The business generates $1.2 billion in annual revenue with a 13.9% net margin and $760 million in free cash flow. From a quality standpoint, Omega shows distressed Altman Z-Score of 1.6 warrants caution and adequate 12% ROE. On valuation, the stock is reasonably priced at 23.9x earnings, with trades above its Graham Number with a negative 66% margin. Growth dynamics show revenue growing at 14.3% and profit growth of 45.4%. The 6.0% dividend yield adds an income component for patient holders. Our composite FairStock Score of 73/100 reflects above-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $760 million in annual free cash flow (5.4% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the real estate space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer