Zacks_Analysts' Blog : HCP: Leads in Sustainability Efforts - Analyst Blog

HCP, Inc. (HCP), a healthcare real estate investment trust (REIT), has recently been acknowledged for its continued commitment to sustainability practices and efforts to reduce energy consumption and negative impacts on the environment. In its recent report, the U.S. Environmental Protection Agency – an entity of the federal government of the U.S. entrusted with the responsibility of protecting human health and the environment, has recognized HCP as the leader in ‘ENERGY STAR’ certifications for its medical office building portfolio.

‘ENERGY STAR’ refers to a joint initiative by of the U.S. Environmental Protection Agency and the U.S. Department of Energy to protect the environment through energy-efficient products and practices. The program helped to save over $18 billion in energy costs in 2010 by working diligently with various business and government organizations and improving the energy efficiency of products, buildings, and corporate offices.

At present about 92 medical office buildings are being awarded with ‘ENERGY STAR’ certifications, out of which 22 are owned and operated by HCP – the largest in the category. Since becoming a partner of the ‘ENERY STAR’ program in 2005, HCP has strived to implement energy-efficient technology throughout its senior housing, life science and medical office portfolios. The current recognition further reveals its continued pledge towards corporate social responsibility and sustainability initiatives.

HCP is the leading medical REIT in the U.S. with one of the largest and most diversified portfolios in the healthcare sector with exposure to all types of facilities. The product diversity of the company allows it to capitalize on opportunities in different markets based on individual market dynamics, and provides a hard-to-replicate competitive advantage over its peers.

We maintain our ‘Neutral’ rating on HCP, which currently has a Zacks #3 Rank that translates into a short-term ‘Hold’ rating, indicating that the stock is expected to perform in line with the overall U.S. equity market for the next 1–3 months. We also have a ‘Neutral’ recommendation and a Zacks #2 Rank (short-term ‘Buy’) for Nationwide Health Properties Inc. (NHP), one of the competitors of HCP.