Extendicare Inc (EXE-T)

Focused on LTC in Ontario, also a home healthcare business just in Ontario (which forms 50% of the business). No longer in retirement homes. If you own it, you've done well; continue to hold and collect the yield now south of 4%. If you have strong view of the home healthcare business, you could dip in at a better entry point.

This has been an extremely good performance year for long-term-care REITs. Not sure there's much more in terms of capital gains from where we are now. Unless substantial pullback, wouldn't buy now.

EXE operates long-term care facilities which require a lot of capital, while CSH is more senior homes. CSH has been divesting lower-return investments to become more of a pure-play. You can charge whatever rent in a market if there's no competition. The seniors' population keeps growing. CSH is paying down debt, which was high a few years ago. In CSH, the easy money has been made, though. It could be a keeper, or take profits.

How COVID will effect this industry, retirement homes? He owns Sienna instead. EXE is much more involved in government-funded LTCs. Along with Chartwell, these two companies are under government scrutiny, so they likely do a much better job than private LTCs. Good question how COVID will affect these homes: there may be increased costs to manage the LTCs, and he expects the government to do more oversight, particularly the incompetent LTCs. He prefers Sienna to EXE, because Sienna is a mix of LTCs and retirement homes, while Chartwell is mostly retirement homes, which has more upside but more competitive. Don't buy purely LTCs, like EXE.

Extendicare has a better chart than Chartwell. It has a head-and-shoulder chart movement. If you take into account the general market sell-off, investors need to be forgiving.