The re-escalating trade tensions between the USA and China have taught us several hard-to-swallow but vital truths, one of which is that anything may happen. The Russia-Ukraine is another example where a physical dispute shakes the economic and financial markets to their core. However, not all stocks to buy are susceptible to unanticipated fluctuations in mood and, thus, are a must-have for diversified portfolios.
Assisted living or retirement home stocks are a market segment that will likely deliver significant returns over the next decade. Elderly care is based on two fundamental principles. First and foremost, we have a moral and ethical commitment to assist people who cannot help themselves. Second, everyone is affected by aging. As a result, these specialized care centers will continue to exist indefinitely.
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5 Canadian Retirement Home Stocks You Should Invest In
Here are five retirement home stocks with the best development potential for Canadian investors hoping to make huge money without sacrificing safety.
Chartwell Retirement Residences (TSX:CSH.UN)
Chartwell Retirement Residences is an unincorporated, open-ended real estate investment trust with 15,589 employees worldwide. The firm is in the business of owning, operating and managing retirement and long-term care communities across Canada. Its retirement and long-term care institutions are run independently; with over 200 outstanding retirement communities in four provinces, including sites under construction, it is the largest operator in the Canadian seniors living business. The Long-Term Care operations segment in Ontario includes about 19 long-term care communities. The Canadian Retirement segment generates the majority of revenue.
On March 31, 2022, Chartwell said it plans to buy three newly developed retirement residences in Ontario with 467 suites from businesses linked with MTCO Holdings. The purchase price is $228 million, including a $3 million deferred payment, before transaction charges and usual closing adjustments. Collingwood, Barrie, and Bowmanville are the locations of the residences. REITs will remain one of the best monthly dividend stocks for conservative investors, regardless of the impact of the pandemic on the industry.
Trading at a share price of $13.01 as of April 15, 2022 (2:19 PM), the company holds a market capitalization of 3,038,297,402. It also pays a monthly dividend of 0.051 CAD per share.
Extendicare Inc. (TSX:EXE)
Extendicare operates under the Extendicare, Esprit Lifestyle, ParaMed, Extendicare Assist, and SGP Purchasing Partner Network brands and provides long-term care and services to seniors across Canada. The company’s five segments are long-term care, retirement living, home health care, other Canadian businesses, and corporate. It owns or operates a network of 119 long-term care homes and retirement communities (69 owned/50 contract services), provides 9.2 million hours of home health care services annually, and provides group purchasing services to third parties representing approximately 93,200 senior residents across Canada. Canada accounts for the great majority of the company’s revenue. It’s also one of the best Medical Services Stocks Canada has.
On March 1, 2022, Extendicare Inc. stated that it had signed agreements for the ownership, operation, and renovation of long-term care establishments in Ontario and Manitoba with Revera Inc. and its affiliates and Axium Infrastructure Inc. and its affiliates. As a result of the addition of 56 long-term care homes, Extendicare Assist’s managed home portfolio has doubled.
Trading at $7.92 as of April 15, 2022 (2:32 PM), the company pays a monthly dividend of 0.04 CAD per share. The market capitalization of 709,334,993, when coupled with the P/E ratio of 60.90, proves the profitability of this stock.
Sienna Senior Living Inc. (TSX:SIA)
Sienna Senior Living Inc. is one of the largest owners of senior housing in Ontario and the province’s largest licensed long-term care operator, and a provider of services across the continuum of care. The company only does business in Canada. LTC Business, Retirement, and Other are the three primary business segments of the corporation. The LTC business section includes 35 LTC facilities in Ontario, eight seniors’ living residences in British Columbia, and the LTC management services business. The retirement segment contains 27 retirement residences (RRs), five of which are located in British Columbia and 22 in Ontario and the RR management services company. The LTC division generates the majority of the company’s revenue.
Sienna Senior Living Inc. declared on April 14, 2022, a dividend of $0.078 per common share for April 2022, yielding $0.936 per Common Share on an annual basis.
Trading at $15.55 as of April 15, 2022 (2:39 PM), the company is a significant player in the assisted living facilities sector. With a market cap of 1,131,870,863, the company is a stable investment.
CareRx Corporation (TSX:CRRX)
CareRx Corp is a company that specializes in providing elderly pharmacy services. It provides services to over 50,000 people in over 850 senior and other communities (long-term care homes, retirement homes, assisted living facilities, and group homes). The company is a nationwide corporation with a vast network of pharmacy fulfillment centers strategically positioned throughout the United States. It collaborates actively with its home operator partners to increase resident health, staff education, and the quality and efficiency of the medical system. It makes money in Ontario and Western Canada by selling goods and charging capitated service fees.
CareRx Corporation stated on March 30, 2022, that it had signed a formal asset purchase agreement to buy Hogan Pharmacy Partners Ltd., a long-term care pharmacy in Ontario that serves roughly 725 residents in long-term care facilities and retirement homes.
Trading at a stock price of $5.47 as of April 15, 2022 (2:47 PM), the company has a prominent name in assisted care and long-term care services. With a market cap of 254,634,255, this stock has extraordinary growth potential, especially after the rise in prices of medicines after the COVID-19 pandemic.
Vitalhub Corp. (TSX:VHI)
Vitalhub Corp is a Canadian company that creates technological solutions for mental well-being (child to adult), long-term care, public health, hospice care, public welfare, and acute care providers. The company’s technologies include blockchain, mobile, patient flow, web-based evaluation, and electronic health record systems.
Vitalhub Corp. announced on March 31, 2022, that it had struck a deal with Cormark Securities Inc. and Eight Capital as co-lead insurers on behalf of a syndicate of underwriters. Under the terms of the agreement, the underwriters will buy 5,645,200 Common Shares from the Company’s treasury for $3.10 each, for total gross proceeds of approximately $17.5 million.
Trading at $3.07 as of April 15, 2022 (2:58 PM), the company holds a bright spot regarding growth prospects. The company is a safe and profitable investment in senior housing communities.
What are some emerging senior care companies?
Here are three emerging Canadian companies that are innovating in areas like senior living technology, healthcare services, or sustainable senior housing, along with a summary of their investment opportunities:
envisAGE
envisAGE is a significant initiative to support Canadian technology solutions for seniors. It commits to invest $47 million from the Strategic Innovation Fund over five years, supporting up to 100 collaborative AgeTech projects. This investment focuses on enhancing the quality of life for seniors through innovative technology solutions. The investment opportunity here lies in the growing AgeTech market, which is expanding due to the increasing senior population and their evolving needs.
Untold Living
Backed by investor Matter Real Estate, Untold Living is working on developing purpose-built retirement housing with care. These developments are tailored to meet the needs of aging populations, combining housing with essential care services. The investment opportunity in Untold Living lies in the growing demand for senior housing that integrates living and healthcare services, an expanding market due to demographic shifts and changing preferences in senior care. Learn more from JLL.
Nautical Lands
This Ottawa-based company is known for promoting luxury lifestyles in its senior housing complexes, catering to exceedingly active senior populations. The investment appeal of Nautical Lands lies in its focus on high-quality senior living experiences, which are increasingly in demand. Their approach to senior housing, which emphasizes luxury and active lifestyles, taps into a niche but growing segment of the senior population that seeks upscale living options. Read more on The Globe and Mail.
These companies represent diverse investment opportunities in the senior living sector, from technology solutions and integrated care housing to luxury senior living experiences. Each offers a unique approach to addressing the needs of Canada’s aging population, presenting potential growth opportunities for investors interested in this sector. You could also try a funeral service stock.
Why You Should Invest in Retirement Home Stocks in Canada
The significance of retirement home stocks in any investor’s portfolio is that of the breadcrumbs for rainy days. Retirement homes, independent living communities, assisted living facilities, and nursing homes are necessities that society can never eliminate, making them the best stocks to buy for the long term in Canada. As a result, these stocks gain an added layer of protection from downward fluctuation and are least susceptible to crashing.
Other primary factors bolster the case for investing in assisted-living firms. The enormity of the baby boomer population is the most considerable tailwind. Between 1946 and 1964, there were 76 million births in the United States. By 2012, 11 million people from this generation had died, leaving 65 million people alive. That’s a lot of people who will need medical attention in their golden years. The best REIT ETFs Canada have invested in senior real estate and healthcare through sales.
The opportunity exists independent of market or economic situations, which is the elephant in the room regarding the importance of retirement homes and assisted living facilities for forestry companies in canada.
Market Trends and Demographics Impacting the Retirement Home Industry in Canada
Demographic Shifts
- Aging Population: Canada, like many developed countries, is experiencing a significant demographic shift, with an increasing proportion of its population being seniors. According to Statistics Canada, the number of Canadians aged 65 and older is projected to grow, making up a more significant percentage of the population. This aging demographic trend is a crucial driver for the demand in senior living and care facilities.
- Longer Life Expectancy: Advances in healthcare have led to longer life expectancies, increasing the need for longer-term senior care and retirement living options.
Market Trends
- Increased Demand for Senior Care Services: The growing number of seniors leads to a higher demand for senior care services, including retirement homes, assisted living, and long-term care facilities.
- Preference for Specialized Care: There is a growing trend towards specialized care facilities that cater to specific health conditions, such as dementia and Alzheimer’s, reflecting the changing healthcare needs of the aging population.
- Technological Integration: Integrating technology in senior care, such as telemedicine, health monitoring systems, and smart home features, is becoming increasingly important. This trend will likely continue as technology advances and becomes more integrated into healthcare.
Investment Considerations
- Stable and Growing Demand: The stable and growing demand for senior living and care services makes it a potentially lucrative investment. The demographic trends suggest that this demand will persist and grow in the coming years.
- Recession-Resistant Nature: The senior living industry is often considered recession-resistant. The need for senior care does not diminish during economic downturns like the best lumber stocks, making investments in this sector relatively stable.
- Diversification of Investment Portfolio: Investing in the senior living sector can provide diversification benefits to an investment portfolio, as the sector may not correlate strongly with other market sectors.
- Real Estate Component: Many senior living investments have a real estate component, which can offer the potential for asset appreciation and income from operations.
- Social Impact: Investing in senior care also aligns with social impact goals, as it contributes to addressing the needs of an aging population.
The Bottom Line
After the COVID-19 outbreak, every industry went downward, but this sector grew in market capitalization and importance. Furthermore, advances in medicine and diet have significantly improved our ability to live longer, pushing life expectancy further. These all factors will play a significant role in the future, proving this market segment to be highly profitable.