The Last Six Months
Ethan Plous@sauce
+2.6%
since Oct 3
The idea
My belief is that most boomer wealth will not pass down as inheritance, it will get spent on care in the final years of life, as patients get pushed toward hospice, home health, and senior housing because they are the cheaper settings. This basket spans that whole care chain: hospice and home health operators, senior housing and skilled nursing landlords, and the hospitals and dialysis providers catching the intensive end of the same spending.
What it owns
- The companies paid directly to care for people in their final months, the core of the take. · Chemed CorporationIt owns VITAS, the largest hospice company in the country and the most direct way to own end-of-life care spending as the population ages., Addus HomeCareIt acquires and scales small home care agencies, capturing spending on aging parents kept at home instead of in hospitals., The Pennant GroupIt runs hospice and home health services where Medicare and families push dying patients, and is deepening the bet by adding senior living real estate., BrightSpring Health ServicesIt delivers care in homes and communities, exactly where the last-six-months spend goes when families avoid hospitals., Aveanna HealthcareIt provides in-home care services and is the smaller, riskier name in the basket with more upside if dying at home accelerates.30%
- The REITs that own the buildings where aging boomers spend their last years, collecting rent on the whole trend. · Welltower IncIt is the largest landlord of senior housing properties, collecting rent on buildings where boomer wealth flows toward end-of-life care., Ventas IncIt owns senior housing and medical properties across the country, capturing rent on the buildings where aging populations spend final years., Omega Healthcare InvestorsIt rents buildings to skilled nursing operators who care for patients too sick for home but not sick enough for hospitals., Sabra Health Care REITIt collects rent on skilled nursing and senior housing properties across the country as a smaller landlord riding end-of-life spending into care real estate., National Health InvestorsIt owns senior housing and care properties with a conservative balance sheet as steady ballast for the decade-long demographic bet on aging boomers.25%
- The operators running nursing and rehab care, the step between hospital and hospice. · The Ensign GroupIt is recognized as the best-run skilled nursing operator, acquiring struggling facilities and fixing them as demand from aging boomers fills beds., Encompass HealthIt runs rehab hospitals that catch patients between acute hospital stays and home, capturing spending on both the intensive and recovery ends of final years., National HealthCare CorpIt operates nursing homes and home care directly as a straightforward bet on more boomers needing paid care at the end of life., Brookdale Senior LivingIt is the biggest senior living operator and the most beaten-down name here, so it is a recovery bet if boomer demand fills its buildings and occupancy rises.18%
- Hospitals and dialysis capture the biggest single bills of the final six months. · HCA HealthcareIt operates the biggest hospital chain and captures the intensive end of the final six months before patients move to hospice., Tenet HealthcareIt operates hospitals and surgery centers capturing expensive procedures that pile up in the final years before care shifts to hospice., DaVita IncIt runs dialysis clinics, one of the clearest examples of heavy recurring spending in a patient's final years with the aging population., Universal Health ServicesIt operates acute care and behavioral hospitals as steady ballast on the intensive end of the care chain with the aging population.18%
- Cash9%