Global Medical: This REIT Just Got a 30% Price Target

Real Estate Investment Trusts, or REITs, are often a favorite among income investors. They offer regular dividends, provide easy exposure to tangible assets, and can serve as a natural hedge against inflation. Within that universe, Global Medical REIT Inc. NYSE: GMRE stands out as a niche player focused on healthcare properties. Its portfolio includes medical office buildings, outpatient facilities, and specialty care centers—all backed by long-term leases and stable tenants. Frustratingly for investors, however, while this brick-and-mortar stability looks good on paper, it hasn’t helped Global Medical much in recent years. Its shares have been in a persistent decline since December 2021, losing more than 60% of their value. As we’ll see below, several factors contributed to this, and the stock hit fresh all-time lows earlier this month. Get Global Medical REIT alerts: But after years of relentless selling, there are finally signs of a bottom forming. With several analysts starting to turn bullish and the technical picture improving, there are reasons to think that Global Medical’s long-awaited recovery is finally taking shape. Let’s jump in and take a closer look. A Brutal Downtrend, But a Clear Floor Emerging Much of the stock’s decline can be attributed to higher interest rates and investor skepticism toward debt-heavy real estate names, which made the bears particularly fond of Global Medical. It didn’t help that leadership was forced to trim its dividend by 29% earlier this year, which shook investor confidence just as the stock was consolidating. But the stock may have found its floor despite having slid further since then. The $30 level has now emerged as a critical line of support; it’s where the bears ran out of steam last May, and buyers have been once again stepping in. Over the past week, shares have bounced hard off the $30 level, suggesting that big money funds might be quietly building up positions. Momentum indicators are also starting to turn in favor of the bulls. The RSI has rebounded from deeply oversold territory, while the stock’s MACD is on the verge of a bullish crossover. After nearly four years of downward pressure, Global Medical’s chart shows early signs of putting in a low. For those of us on the sidelines, that makes for an interesting entry point. Analysts Are Turning Bullish Again An ongoing shift in Wall Street sentiment is helping to strengthen that case. Earlier this week, Citizens JMP upgraded its rating on Global Medical from Market Perform to Outperform while setting a new price target of $40. From where the stock closed on Wednesday evening, that’s pointing to a targeted upside of nearly 30. Their bullish update echoed that of Zacks Research, which upped its rating on Global Medical to Strong Buy last month, highlighting growing optimism across the analyst community. There appears to be a consensus that much of the downside has now been factored in, and the company’s improving balance sheet and supportive macroeconomic backdrop are reasons to be bullish. Indeed, the broader environment for REITs is starting to improve. Expectations of further interest-rate cuts relieve yield-sensitive stocks, such as Global Medical, while their recently announced $50 million share repurchase program adds another layer of support. Their new CEO’s focus on deleveraging shows the company is intent on turning the page on what’s been a painful few years for shareholders. For investors thinking about getting involved around the $30 mark, the company’s 9.31% dividend yield looks particularly compelling. It provides an attractive income stream even if the recovery takes time. Risks Remain, But The Setup Is Compelling At the same time, there are still risks to consider. Global Medical remains highly sensitive to interest-rate movements, and while the Fed is in a softening cycle, the timing of all this remains uncertain. The company also faces lingering skepticism from investors who’ve watched their shares continue to sell off while the broader market posted high after high this past summer. Still, the risk/reward balance looks favorable at these levels. After a 60% peak-to-trough decline, much of the bad news has likely been priced in, and the recent analyst upgrades suggest sentiment is starting to shift. If shares can hold above $30 through the rest of October, it would confirm that a durable base has formed. From there, the technicals and analyst targets point to room for a meaningful rebound into year-end.Should You Invest $1,000 in Global Medical REIT Right Now?Before you consider Global Medical REIT, you'll want to hear this.MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Global Medical REIT wasn't on the list.While Global Medical REIT currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.View The Five Stocks Here