DOC

We rate HEALTHPEAK PROPERTIES, INC. (DOC) as Avoid with a composite score of 39.4/100 at a current price of $17.25. The stock falls in the bottom quintile of our universe across key quantitative factors, and the multi-factor weakness suggests a high probability of continued underperformance.

The rating is primarily driven by strength in stability (69th percentile) and value (50th percentile), which together account for the majority of the composite score. Offsetting weakness in quality (26th percentile) and momentum (27th percentile) tempers our overall conviction. We assign a No Moat rating (23/100), Medium uncertainty, and Poor capital allocation.

Key items to watch: momentum to confirm whether the current price trend has legs; balance sheet deleveraging progress. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.

HEALTHPEAK PROPERTIES, INC. holds a top-quartile position (#0 of 50) within the Finance, Insurance, And Real Estate sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 39.4/100 places it at rank #3611 in our full 7,333-stock universe. With a $11.1B market capitalization, HEALTHPEAK PROPERTIES, INC. operates at meaningful scale within the Finance, Insurance, And Real Estate sector, providing competitive advantages in distribution, procurement, and customer reach.

Revenue is growing at 14%, though momentum at the 27th percentile suggests the market has not yet fully recognized this trajectory. This potential disconnect between fundamental improvement and market recognition could represent an opportunity for patient investors if the growth trend persists.

The margin cascade tells an important story: gross margins of 60% (-16.5pp vs sector) narrow to operating margins of 7% (-10.2pp vs sector) and net margins of 2.6%, yielding a gross-to-net conversion rate of 4%. The significant margin erosion from gross to net suggests elevated operating expenses, high interest costs, or other structural drags that warrant monitoring.

At a current price of $17.25, HEALTHPEAK PROPERTIES, INC. is trading near fair value based on current fundamentals. Our value factor score of 50/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. Valuation metrics are mixed, with no strong signal of mispricing in either direction.

The stock currently trades at a P/E of 164.1x (a 1275% premium to the sector median of 11.9x), EV/EBITDA of 17.1x (at a premium), P/B of 1.4x, P/S of 4.2x. The above-sector P/E multiple suggests the market is pricing in superior growth or quality, which our analysis finds only partially justified by current fundamentals.

We assign a Medium uncertainty rating to HEALTHPEAK PROPERTIES, INC.. The stock presents a balanced risk profile: significant leverage (121% debt-to-equity) and weak quality scores (26th percentile). While not risk-free, the core business fundamentals are adequate to withstand moderate economic stress, and the range of potential outcomes around our fair value estimate is manageable.

Specific risk factors that inform our assessment include: significant leverage (121% debt-to-equity); weak quality scores (26th percentile); low beta of 0.47 — while defensive, this may indicate limited upside participation in bull markets; elevated valuation multiple (P/E 164.1x) that leaves limited margin for error. Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 69th percentile and quality factor at the 26th percentile provide a quantitative summary of the overall risk landscape.

Key risk mitigants include: healthy gross margins of 60% provide a buffer against cost pressures; above-average stability (69th percentile) suggests predictable business dynamics; a 7.63% dividend yield anchors total return. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile is favorable for long-term investors.

We rate HEALTHPEAK PROPERTIES, INC.'s capital allocation as Poor. Key concerns include low returns on equity (0.9%), weak asset returns (ROA 0.4%). Exemplary capital allocators generate ROE above 20% and maintain conservative leverage — HEALTHPEAK PROPERTIES, INC. significantly underperforms these benchmarks, raising questions about management's ability to create shareholder value.

Investors should scrutinize management's reinvestment decisions and balance sheet trajectory before committing capital. Poor capital allocation often compounds over time: overlevered balance sheets limit strategic flexibility, while low returns on capital destroy shareholder value. We would need to see sustained improvement in profitability metrics and balance sheet discipline before considering an upgrade.

In summary, HEALTHPEAK PROPERTIES, INC. receives a Avoid rating with a composite score of 39.4/100 (rank #3611 of 7,333). Our quantitative framework assigns a No Moat (23/100, trend: stable), Medium uncertainty, and Poor capital allocation. The average factor score across quality, value, momentum, stability, and investment is 41/100.

Our analysis does not support a constructive view on HEALTHPEAK PROPERTIES, INC. at this time. The combination of limited competitive advantages, medium uncertainty, and poor capital allocation suggests unfavorable risk-reward at current levels. We recommend investors avoid new positions and existing holders consider reducing exposure.