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Mr. Kalmar set a $15.50 target for Toronto-based Sienna, topping the $14.23 and pointing to a potential gain of 18.1 per cent.
“SIA owns and operates a combined portfolio of retirement residences and longterm care (LTC) homes (50/50 NOI split). Geographically, SIA’s portfolio is heavily concentrated in Ontario, where approximately 80 per cent of its suites/beds are located, while the rest of the portfolio is split between B.C. and Saskatchewan,” he said. “In our view, SIA’s portfolio mix presents investors with a compelling risk/reward balance, as exposure to the highermargin retirement segment is partially hedged by its exposure to the more stable LTC segment. While investors may not have all the upside of a pureplay retirement home portfolio, there is downside protection via its LTC portfolio. SIA also offers investors access to one of the largest seniors housing operating platforms in Canada and we view the recent rebranding of its retirement and LTC platforms favourably. We also see additional upside through its development and acquisition programs. We believe the current valuation represents a compelling entry point to gain access to a highquality, balanced seniors housing portfolio capable of generating midsingledigit OFFO growth and wellpositioned to benefit from both an acceleration in retirement fundamentals and a growing focus on improving the LTC model.”