Healthcare is one of the largest and fastest-growing industries worldwide. We believe that NorthWest Healthcare Properties REIT (TSX: NWH-U, OTC: NWHUF) is well positioned to benefit from this trend for decades to come.

NorthWest owns and operates medical office buildings, hospitals, clinics, and aged-care facilities in Canada, Germany, Australia, New Zealand, and Brazil.

NorthWest acquired its international operations in 2015, and the REIT’s overseas presence gives it greater scale and better diversification.

Operating and financial metrics have been improving over the past 18 months. Meanwhile, the quality of the REIT’s portfolio has been enhanced by several acquisitions and divestitures.

Investors have started to acknowledge the improvement  in the business, and the unit price is up 25% over the past year. We believe that the ongoing improvement will continue to drive the unit price even higher.

Despite recent gains, NorthWest is still undervalued compared to its global peers. The REIT’s distribution currently yields an attractive 7.7%, and there’s potential for further distribution growth in 2017. We estimate NorthWest’s fair value at C$14, or US$10.50.

 A full report on NorthWest will appear in the February issue of Canadian Edge.