Here’s Why Aristotle Capital Disposed its Omega Healthcare Investors (OHI) Stake

Aristotle Capital Management, an independent/employee-owned investment management organization, published its “Aristotle Small Cap Equity Fund” first quarter 2022 investor letter – a copy of which can be downloaded here. For the first quarter of 2022, the Aristotle Small Cap Equity Composite generated a total return of -5.77% gross of fees (-5.92% net of fees), outperforming the -7.53% total return of the Russell 2000 Index. Try to spend some time looking at the fund’s top 5 holdings to be informed about their best picks for 2022.

In its Q1 2022 investor letter, Aristotle Capital Management Small Cap Equity mentioned Omega Healthcare Investors, Inc. (NYSE:OHI) and explained its insights for the company. Founded in  1992, Omega Healthcare Investors, Inc. (NYSE:OHI) is a Cockeysville, Maryland-based real estate investment trust company with a $7.1 billion market capitalization. Omega Healthcare Investors, Inc. (NYSE:OHI) delivered a -0.24% return since the beginning of the year, while its 12-month returns are down by -19.15%. The stock closed at $29.52 per share on May 26, 2022.

Here is what Aristotle Capital Management Small Cap Equity has to say about Omega Healthcare Investors, Inc. (NYSE:OHI) in its Q1 2022 investor letter:

“Omega Healthcare Investors (NYSE:OHI), healthcare-focused real estate investment trust, was removed from the portfolio due to a deterioration of the financial condition of its tenant base. After seeing an improvement in the prior couple of quarters, management highlighted the potential for a worsening outlook for delinquencies with subdued occupancy due to COVID-related concerns and labor shortages. We believe higher labor costs due to the ongoing nursing and general labor shortage are also negatively impacting their customers and have decided to step away from our investment.”

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Our calculations show that Omega Healthcare Investors, Inc. (NYSE:OHI) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Omega Healthcare Investors, Inc. (NYSE:OHI) was in 20 hedge fund portfolios at the end of the first quarter of 2022, compared to 15 funds in the previous quarter. Omega Healthcare Investors, Inc. (NYSE:OHI) delivered a 6.46% return in the past 3 months.

In February 2022, we published an article that includes Omega Healthcare Investors, Inc. (NYSE:OHI) in 5 Blue Chip Dividend Stocks With Over 4% Yield. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q1 page.

Disclosure: None. This article is originally published at Insider Monkey.