Sabra Health Care REIT, Inc. increased its full-year 2026 guidance for Normalized FFO and Normalized AFFO per share by 7% and 8%, respectively, following strategic portfolio transitions and debt reduction initiatives. The company expects Normalized FFO to range between $1.53 and $1.55 per share, while Normalized AFFO is projected to be between $1.59 and $1.61 per share. This update reflects the successful execution of its strategy to enhance portfolio quality and focus on core senior housing and skilled nursing segments.

Portfolio Transition and NOI Growth

Sabra entered into letters of intent to re-tenant all 26 properties leased to Avamere. Under the proposed transition, 22 properties will move to subsidiaries of Cascadia Healthcare, and four properties will transition to an existing Sabra tenant. Upon closing, the combined annualized cash rent is expected to be $53 million, a nearly 30% increase compared to the $41 million received during the trailing-twelve-month period ending March 31, 2026. The transition is expected to be completed in the second half of 2026.

Additionally, several smaller portfolio initiatives, including re-tenanting and rent resets, are expected to increase cash NOI by over $9 million per year on a run-rate basis compared to the twelve months ending March 31, 2026.

Debt Reduction and Balance Sheet

Sabra and Recovery Centers of America agreed to a reduced cash repayment of $200 million in full satisfaction of a $300 million mortgage maturing on November 1, 2026. The transaction closed on June 30, 2026, with proceeds used to reduce the balance on Sabra’s revolving line of credit. Pro forma for this announcement as of March 31, 2026, Net Debt to EBITDA declined from 5.0x to 4.8x, and behavioral health concentration decreased from 13% to 9% of Annualized Cash NOI.

Full-Year 2026 Guidance

The updated guidance ranges per diluted common share are as follows:

Guidance assumptions include low-single-digit Cash NOI growth for the triple-net portfolio and low-to-mid teens growth for the same-store Senior Housing - Managed portfolio. General and administrative expenses are projected at $61 million, including $13 million of stock-based compensation, and cash interest expense is estimated at $104 million.

Truist Securities analyst Michael Lewis has upgraded Sabra Health Care REIT from Hold to Buy while maintaining a price target of $22. This rating change signals increased confidence in the healthcare real estate investment trust's potential to outperform the market. The upgrade and target price were detailed in a recent report, offering investors a revised outlook on the stock's trajectory.

Analyst Details

The coverage update comes from Michael Lewis, an analyst at Truist Securities. The shift from Hold to Buy suggests that the stock is now expected to deliver returns superior to the broader market or the analyst's coverage universe. This adjustment reflects a reassessment of the company's fundamentals or market position.

Price Target

The price target maintained by Truist Securities stands at $22. This figure represents the analyst's projection of where the stock price is headed within a specific timeframe, providing investors with a concrete benchmark for valuation. The decision to keep the target steady despite the rating upgrade indicates that the previous price goal remains appropriate under the new bullish thesis.