As Alzheimer’s Dementia Increases So Could Nursing Home Stocks

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The number of people with Alzheimer’s disease rises above five million, one of the questions that come up is who will care for the patients. As The Wall Street Journal points out, the baby boomers are about to start turning 65, and age is the No.1 factor in "the long-forecast dementia epidemic."

There are several companies in the nursing home and elder care industry that are likely to benefit from the problems of an aging population:

Senior Housing Properties (SNH) The stock trades at $22.56, near the middle of its 12-month range. Total revenue last year was $179.8 million.

Sunrise Senior Living (SRZ) The company has problems with releasing its financials because the SEC has requested that the company restate its 2005 numbers. That does not seem to have hurt the stock. It trades at $39.12, just below the 52-week high of $41.50.

Brookdale Senior Living (BKD) Another company in the industry that has its trials. Company revenue doubled in Q4 to $432 million. But, one time charges knocked down net and Goldman Sachs downgraded the shares. Trades in middle of its range at $45.28.

Assisted Living (ALC) Not growing very fast, which is odd. Revenue in Q4 was $58.5 million. Operating margins strong with $9 million income from operations. Trades at $11.98 near the 52-week high of $13.18.

Manor Care (HCR) Mostly short-term assistance, but, as the patient profile changes, so could that. Q4 profits up 56% and upgraded by Matrix Research. Trades at $54.18, near 52-week high of $55.33.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.