Welltower Raises Annual Outlook After 24.6% Growth in Funds from Operations in Third Quarter
Key Facts
Welltower reported results on October 26, 2026, for the third quarter ended September 30, posting adjusted funds from operations of $1.67 per diluted share, up 24.6% year over year, and net income of $415 million. The company’s announcement pointed to improving operating activity, particularly in its senior housing portfolio, and it raised its outlook for fiscal 2026. The results followed a quarter in which adjusted funds from operations grew to $1.34 per share, or 20.7%, in the corresponding period of 2025. Same-store net operating income growth for the total portfolio also rose to 15.8% in the latest quarter. Welltower said its senior housing operating portfolio led that growth, increasing 21.0%.
Within the senior housing operating portfolio, organic same-store revenue grew 9.1% year over year, average occupancy rose 320 basis points, and revenue per occupied room increased 5.3%. These indicators reflect contributions from both improved occupancy and higher revenue per room to the segment’s performance, alongside growth in net operating income. Same-store net operating income growth in the portfolio was 20.3% in the third quarter of 2025, before reaching 21.0% in the latest period. At the company level, total portfolio growth of 15.8% was below the segment rate, as it covers a broader portfolio than senior housing. Welltower said the senior housing segment was the main driver of operating growth in the quarter.
Welltower raised its 2026 adjusted funds from operations guidance to $6.47–$6.53 per diluted share, from a previous range of $6.36 to $6.44. It also raised its forecast for net income attributable to common shareholders to $3.31–$3.37 per share, compared with the previous estimate of $3.11–$3.19. The annual revision reflects improved company estimates for both measures, while funds from operations and net income remain separate metrics in its guidance. The company expects total same-store portfolio net operating income growth of 15.0% to 16.25% in 2026. For the senior housing operating segment, it projects growth of 20.25% to 21.75%.
The company expanded its investments during the quarter, completing gross pro rata investments of $4.1 billion, including $2.7 billion across 43 senior housing properties. Since the start of the year, total completed or contracted investments reached $21.0 billion, of which $13.3 billion was completed during the nine months ended September 30. The figures show that a large share of investment continues to be directed toward properties linked to senior care, while the segment recorded the strongest operating growth among the figures reported by the company. On financial capacity, Welltower said available liquidity totaled about $9.5 billion as of September 30. Net debt to adjusted earnings before interest, taxes, depreciation and amortization stood at 3.02 times on the same date.
The stock’s performance did not match the strength of the operating indicators in the trading session after the results; Investing.com reported that it fell 6.23% to $225.61 on October 27, from a previous close of $240.61. The closing price reported by EL7 data for that day was $226.72. UBS, meanwhile, said it maintained its “Buy” rating on the stock and set a $269 price target following the third-quarter results. Investing.com also reported that the company’s revenue was $3.72 billion, exceeding analysts’ estimate of $3.66 billion. This comes as the Seeking Alpha report cited in the draft about an upgrade to “Strong Buy” could not be verified, so that upgrade is not treated here as confirmed information.
Markets are awaiting Welltower’s fourth-quarter results, expected in February 2027, according to Trefis. The company’s raised annual guidance, including its ranges for adjusted funds from operations and net income, will serve as a benchmark for comparing upcoming results with what it reported in the third quarter. Growth in the senior housing operating portfolio also remains a key focus in assessing the performance outlook, after it recorded net operating income growth of 21.0% in the quarter. The company completed $13.3 billion of investments during the nine months through the end of September, as part of $21.0 billion in completed or contracted investments since the start of the year. Fourth-quarter results are due in February 2027.