AHR's Q4 2025 Earnings Call Signals Growth Peak, Validating DeepValue's Sell Rating Amid High Valuation

What happened

American Healthcare REIT reported its Q4 2025 results, showcasing strong same-store NOI growth but issuing 2026 guidance that indicates a slowdown to high-single digits, down from prior double-digit levels. Management highlighted continued occupancy gains and acquisition activity, yet the guidance reflects normalization as sector competition intensifies and labor costs pressure margins. The DeepValue master report had flagged this risk, noting that AHR's valuation at 32x EV/EBITDA prices in unsustainable growth, making the stock vulnerable to multiple compression. Despite upbeat rhetoric from executives, the reliance on a $1B ATM program for funding acquisitions adds dilution risk, which could erode per-share metrics if growth falters. Investors now face a reality where the growth narrative is maturing, aligning with the report's view that upside is limited compared to significant downside potential.

Implication

The earnings call reinforces that AHR's growth is peaking, implying that the stock's rich multiples are unjustified without sustained double-digit expansion, leading to likely price pressure. Investors must monitor 2026 execution closely, as any miss on NOI targets or increased ATM usage could trigger a de-rating toward the bear case value of $38. The dividend yield of 2.1% offers scant protection, and dependency on equity markets for growth funding heightens vulnerability in a downturn. Position sizing should be cautious, with trimming advised above $50 to lock in gains before potential downside. Long-term holders should reassess in 6-12 months based on whether ISHC/SHOP margins hold or if guidance is revised downward further.

Thesis delta

The investment thesis shifts towards the bear case, as 2026 guidance points to moderating growth that fails to support the current premium valuation, increasing the probability of multiple compression. This validates the DeepValue report's 'POTENTIAL SELL' rating, emphasizing that downside risk now outweighs upside potential unless external factors like acquisition yields improve unexpectedly.