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    NHI
    Earnings call· Dec 2025(Q4 FY25)

    NATIONAL HEALTH INVESTORS Q4 FY25 earnings call NHI

    Feb 27, 2026 Source

    Executive summary

    National Health Investors, Inc. Q4 FY25 — Strong SHOP Growth and Active Investment Pipeline

    National Health Investors concluded FY25 with strong normalized FFO per share growth, driven by significant expansion in its SHOP platform and active investment activity. While 2026 guidance reflects a lower growth rate due to non-recurring items and planned dispositions, the company is strategically focused on expanding its SHOP portfolio in need-driven senior living, leveraging its strong balance sheet and a robust pipeline to drive long-term FFO per share growth. The company is in a quiet period regarding ongoing NHC lease negotiations.

    Highlights

    5

    • Normalized FFO per share grew 8.9% YoY in Q4 FY25 and 10.6% for full year FY25.

    • Total SHOP NOI increased by 125% YoY in Q4 FY25 and 48% sequentially.

    • Announced investments of $392 million in FY25, exceeding initial guidance of $225 million.

    • Active pipeline of over $488 million with an additional $111 million under signed LOI.

    • Leverage less than 4x net debt to adjusted EBITDA, with $875 million available liquidity.

    Concerns

    4

    • 2026 Normalized FFO per share guidance of 1.2% growth at midpoint, below core growth rate due to non-recurring 2025 benefits and dispositions.

    • Planned dispositions of $111 million of nonstrategic assets impact 2026 growth by an estimated 1.5%.

    • Same-store NOI on 15 legacy Holiday properties declined by less than 1% YoY in Q4 FY25.

    • Interest income declined by 19% in Q4 FY25 due to loan payoffs and pay downs.

    Guidance & targets

    11
    CategoryTargetConfidence
    Normalized FFO per share growth
    1.2%
    high materiality
    Medium
    Core normalized FFO per share growth
    5% to 6% range
    high materiality
    Medium
    SHOP NOI growth
    over 105%
    high materiality
    High
    Investment activity allocation to SHOP
    70%
    medium materiality
    High
    Same-store NOI increase (15 legacy Holiday properties)
    7% to 8%
    medium materiality
    Medium
    Additional future investments
    $230 million
    medium materiality
    Medium
    NAREIT FFO per share growth
    6.9%
    high materiality
    Medium
    Normalized FFO per share growth
    1.2%
    high materiality
    Medium
    Total FAD growth
    7.8%
    medium materiality
    Medium
    NOI expectations for 26 SHOP properties
    $39.6 million
    medium materiality
    High
    Leverage policy (Net Debt to Adjusted EBITDA)
    3.5x to 4.5x
    high materiality
    High

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    SHOP
    Total NOI increased due to the transition of 7 properties on August 1st and the acquisition of 4 properties on October 1st. Expected double-digit NOI growth from this group as it enters the same-store portfolio later this year and early next.
    Annualized NOI contribution: 12% of total annualized NOIAnnualized NOI contribution (prior year): 4.5% of total annualized NOIInvestment increase (last 12 months): 106% to $740 millionNOI expectations for 26 SHOP properties (2026 midpoint): $39.6 millionYield on current in-place SHOP invested capital: 5.4%
    		—124.9%48%$7.3 million
    Triple Net Portfolio
    Cash rental revenue increased primarily due to acquisitions, successful transition of properties formerly operated by SLM, and annual escalators. Deferral collections are largely complete, with Bickford repayments progressing well.
    Cash rental income increase: 7% (Q4 YoY)Interest income decline: 19% (Q4 YoY)Deferral collections: $1.9 million (Q4)Deferral collections decrease: 17% (Q4 YoY)Bickford repayment increase: 38% to $1.5 million (Q4)Bickford outstanding balance: $7.6 million (as of Dec 31, 2025)
    		—7.2%——

    Operational metrics

    31
    Normalized FFO per share
    $1.228.9% YoY growth
    Q4 FY25

    Compared to last year.

    Normalized FFO per share
    $4.9110.6% YoY growth
    FY25

    Compared to prior year periods.

    FAD growth
    13.7%
    FY25

    Total FAD growth for the full year.

    FAD
    $57.9 million11.1% YoY growth
    Q4 FY25

    Compared to prior year period.

    FAD
    $232.1 million13.7% YoY growth
    FY25

    Compared to prior year period.

    Net income per share
    $0.8015.8% YoY decrease
    Q4 FY25

    Decrease from prior year due to noncash gain related to derivative accounting and gain on sales of real estate in prior year.

    Net income per share
    $3.02vs $3.13 in prior year
    FY25

    For the 12-month period.

    NAREIT FFO per share
    $1.221.6% YoY decrease
    Q4 FY25

    Prior year period benefited from $6.3 million gain from derivative accounting.

    NAREIT FFO per share
    $4.652.2% YoY increase
    FY25

    Compared to prior year period.

    Gains from equity method investments
    $3.7 millionup from $0.4 million in prior year
    FY25

    Non-recurring item benefiting 2025 results.

    Credit loss reserves benefit
    $3.4 millionvs $4.6 million expense in prior year
    FY25

    Non-recurring item benefiting 2025 results.

    Cash rental income upon lease terminations
    $3.9 million
    FY25

    Excludes noncash write-offs and noncash rental income related to operations transfers. Non-recurring item benefiting 2025 results.

    Weighted average common diluted shares
    47.9 million5.4% YoY increase
    Q4 FY25

    Result of the company's greater use of equity in lieu of debt.

    Cash G&A
    $6.6 million39.9% YoY increase
    Q4 FY25
    Cash balance
    $19.6 million
    Dec 31, 2025

    On balance sheet.

    Revolver capacity
    $496 million
    Dec 31, 2025
    ATM capacity
    $315.8 million
    Dec 31, 2025

    Assuming the settlement of forward equity sale agreements.

    Available liquidity
    $875 million
    Dec 31, 2025

    Attributable to cash, excess revolver, forward equity, and additional ATM capacity.

    Dividend per share
    $0.92
    Q1 FY26

    Declared for shareholders of record March 31, 2026, payable May 1, 2026.

    Units under construction (senior housing)
    <25,0002.2% of total inventory
    Q4 FY25

    Lowest level since 2012.

    New unit starts (senior housing)
    <1%
    Q4 FY25

    Lowest level since NIC MAP started reporting in 2008.

    Employees
    3546% increase from average in 2022
    current

    Since establishing SHOP platform.

    Escrowed forward equity proceeds
    $44.5 million
    Dec 31, 2025

    Available for future delivery of 600,000 common shares at an average price of $69.23 per share.

    Forward ATM equity activity settlement
    600,000
    Q4 FY25

    From Q2 2025 forward ATM equity activity.

    Target investment yield (SHOP)
    7% to 8%
    near-term

    For stabilized properties in target markets.

    Target NOI growth (SHOP)
    high single-digit to low double-digit range
    first few years

    Expected from new SHOP investments.

    Target rate of return (SHOP)
    low- to mid-teens
    near-term

    Expected from new SHOP investments.

    Initial NOI yield (February 2026 SHOP acquisition)
    8%7.6% including routine CapEx
    first year

    For $105.5 million acquisition of 9 properties.

    NOI growth (February 2026 SHOP acquisition)
    solid double-digit growth
    year 2

    Expected after transitional impacts in year 1.

    Investment with Spring Arbor
    $227 million
    current

    Total investment.

    Initial yield (Jamison, PA acquisition)
    8%
    initial

    For $52.1 million property operated by Priority Life Care.

    Industry KPIs

    4
    MetricValueDetails
    Senior housing occupancy100%%
    Operator tenant concentration6operators
    Same store noi growth by segment7.6%%
    Investment volume and sourcing mix$392.4 millionUSD

    Orderbook & backlog

    3
    Investment pipeline (senior housing)$488 millionQ4 FY25

    Excludes any portfolio deals; reviewing several large potential investments.

    Investments under signed Letters of Intent$110.6 millionQ4 FY25

    Primarily in SHOP.

    Planned dispositions$111 million2026 guidance

    7 buildings with six different operators; nonstrategic assets.

    Deals & partnerships

    2
    Allegro Living ManagementAcquisition of 9 senior housing properties$105.5 million

    Largest SHOP acquisition to date, for properties in Kentucky, South Carolina, and Tennessee. Allegro is an affiliate of Spring Arbor Management.

    Priority Life CareAcquisition of a property in Jamison, Pennsylvania$52.1 million5-year lease

    Priority is a new operator relationship for NHI, well-established with over 60 properties across 12 states.

    Risks & headwinds

    4
    Impact of non-recurring items on 2026 FFO growthFY26

    2025 results benefited from $3.7M gains from equity method investments, $3.4M credit loss reserves benefit, and $3.9M cash rental income upon lease terminations, which are not recurring in 2026.

    Mitigation: Management estimates core growth rate of 5-6% when adjusting for these items.

    Impact of planned dispositions on 2026 FFO growthFY26

    $111 million of dispositions of nonstrategic assets impact 2026 growth by an incremental and estimated 1.5%.

    Mitigation: Capital from dispositions will be reallocated to relationships with more growth potential, particularly SHOP, to improve asset management efficiency.

    Transitional impacts on newly acquired/transitioned SHOP propertiesFY26

    Allegro Living Management is a new manager for the February acquisition, expecting some transitional impacts in the first year.

    Mitigation: Forecast solid double-digit growth in year 2; focus on putting in right systems and people, building funnels, and responsible rate increases.

    NHC lease negotiations uncertaintyThrough FY26

    Lease matures December 31, 2026; no assumption for early resolution in 2026 guidance.

    Mitigation: Negotiations are ongoing; company is in a 'quiet period'.

    What to watch in Q1 FY26

    5

    NHC Lease Negotiations

    Next quarter
    CurrentOngoing, lease matures Dec 31, 2026
    TargetResolution or update on progress

    Why it matters

    The NHC lease represents a significant portion of the portfolio, and its resolution will impact future revenue and potential capital recycling.

    Excluded from our guidance is any assumption for the early resolution of our NHC lease, which matures December 31, 2026. Negotiations are ongoing, and we expect to have more to report as the year progresses.

    Q&A highlights

    6

    Is the 7-8% same-store SHOP guidance conservative, given prior commentary about potential double-digit growth and corrective measures?

    Kevin Pascoe stated the guidance is conservative, aiming to 'under-promise, over-deliver.' He noted that 16 units in one 100% occupied building will come online in May, contributing to growth, and the second half of the year is expected to be stronger after a softer Q1.

    “we want to deliver something that we feel very confident that we can achieve. And there is -- there should be opportunity within the portfolio from there. So it's a bit of an under-promise, over-deliver.”

    asked by Farrell Granath · answered by Kevin Pascoe

    2 min read6 chapters

    Detailed Narrative

    01

    SHOP Platform Expansion and Strategy

    NHI significantly expanded its SHOP platform, increasing investment by 106% in the last 12 months to approximately $740 million. This has boosted annualized SHOP NOI contribution to 12% of total annualized NOI, up from 4.5% at the end of 2024. The company expects 70% of 2026 investment activity to be in SHOP, targeting need-driven senior living communities in secondary suburban markets with attractive yields of 7% to 8% and expected near-term NOI growth in the high single-digit to low double-digit range.

    02

    Active Investment Activity and Pipeline

    FY25 saw $392 million in announced investments, exceeding initial guidance of $225 million, with $218 million in Q4 alone. The company has already closed a $105.5 million SHOP acquisition in February 2026 and maintains an active pipeline of over $488 million, plus $111 million under signed LOI, all in senior housing. This reflects the most active investment year since 2016, with management confident in meeting or exceeding last year's total investments.

    03

    Balance Sheet Strength and Revised Leverage Policy

    NHI maintains a strong balance sheet with net debt to adjusted EBITDA less than 4x and available liquidity of approximately $875 million. The company announced a new leverage policy, lowering its target range from 4x-5x to 3.5x-4.5x net debt to adjusted EBITDA. This revision reflects a commitment to its investment-grade rating and adaptation to the current higher interest rate environment, providing a competitive advantage in financing deals.

    04

    2026 Outlook and Growth Drivers

    While 2026 normalized FFO per share guidance shows 1.2% growth, management estimates a core growth rate of 5% to 6% when adjusting for non-recurring📎 2025 benefits and planned dispositions. The guidance includes $111 million in dispositions of nonstrategic assets, impacting growth by an estimated 1.5%. SHOP NOI is expected to grow over 105% in 2026 before new investments, with the company focused on long-term FFO per share growth.

    05

    Favorable Senior Housing Market Fundamentals

    The senior housing industry benefits from favorable tailwinds, with fewer than 25,000 units under construction (2.2% of inventory, lowest since 2012) and new unit starts below 1% of inventory (lowest since 2008). Demand is accelerating as the first baby boomers turn 80 in 2026, positioning NHI to capitalize on long-term generational growth. The company is adding talent rapidly, with 35 employees, a 46% increase since establishing its SHOP platform in 2022.

    06

    NHC Lease Negotiations and Bickford Repayments

    The company is currently in a 'quiet period' regarding ongoing lease negotiations with NHC, which matures on December 31, 2026, with no assumptions for an early resolution included in the 2026 guidance. Separately, Bickford's deferred rent repayments increased 38% to $1.5 million in Q4, with an outstanding balance of $7.6 million. Management expects Bickford's cash rental revenue to increase after the April 1st rent reset, with discussions ongoing for the remaining balance.

    AI-generated summary of the company’s earnings call. Not investment advice.