Diversified Healthcare Trust Stock Earnings Reports

Diversified Healthcare Trust (DHC) reported a strong Q1 2026 driven by operational improvements in its seniors housing operating portfolio (SHOP) and a healthier balance sheet. Key financials: normalized FFO of $33.1M ($0.14/share), adjusted EBITDAre of $74M, and consolidated NOI of $75.9M (up 4.7% YoY). SHOP same-property NOI rose 13.5% YoY to $44.3M, supported by 110 bps occupancy improvement, 5.9% average monthly rate growth, and notable expense reductions (including a ~35% decline in contract labor YoY). DHC is executing active asset management and operator transitions that are showing early benefits; management is focused on retrofitting underutilized skilled-nursing wings into independent/assisted living and memory care. They’ve identified 16 conversion opportunities (6 initial projects costing ~$20M to add ~150 units) expected to be accretive with mid-teens returns. Medical office & life science NOI also grew (3.7% YoY) with strong leasing activity. Capital actions: sale of 13 non-core SHOP communities ($23M), exercised land-lease purchase options ($14.5M), and completion of a large capital recycling program. Balance sheet: $272M liquidity, net debt / adjusted EBITDAre down to 7.8x (from 8.8x), improved interest coverage (2.0x vs 1.3x a year ago), no debt maturities until 2028, and Moody’s upgrade to B3 with positive outlook. Guidance: reaffirmed full-year 2026 ranges including SHOP NOI $175–185M, MOB & life science NOI $94–98M, adjusted EBITDAre $290–305M, and normalized FFO $0.52–0.58/share. Management expects recurring CapEx of $100–115M for 2026 (including ~$80–90M in SHOP), with maintenance capex run-rate potentially moderating over time. Overall, DHC emphasized operational momentum, targeted organic ROI projects, capital discipline, and confidence in further margin and earnings improvement.