NEW YORK (TheStreet) -- Shares of Ventas Inc. are gaining by 5.07% to $76.94 at the start of trading on Monday morning, after the senior housing and healthcare properties REIT announced it has agreed to purchase the privately held Ardent Medical Services for $1.75 billion in cash. Ardent Medical Services is a provider of health care services and one of the ten largest for-profit hospital companies in the U.S., Ventas said in a statement. After the deal closes, which is expected in the middle of the year, Ventas said it intends to separate Ardent Health Services' hospital operations from its owned real estate and sell the hospital operations to one or more newly formed entities. The transaction will make Ventas the owner of 10 "high quality" hospitals across the country. This transaction builds upon our excellent track record of executing innovative and value-creating opportunities, and solidifies our leadership position in healthcare real estate," Debra Cafaro, Ventas CEO said in a statement. "The addition of Ardent's platform, which includes high-quality assets with significant market share in three key markets, and a highly-regarded hospital management team, creates a strong avenue for growth in the attractive hospital real estate market. The transaction also increases our diversification by property type and operator," Cafaro added. Separately, TheStreet Ratings team rates VENTAS INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation: "We rate VENTAS INC (VTR) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income." Highlights from the analysis by TheStreet Ratings Team goes as follows: Despite its growing revenue, the company underperformed as compared with the industry average of 9.9%. Since the same quarter one year prior, revenues slightly increased by 9.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share. Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year. VENTAS INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, VENTAS INC reported lower earnings of $1.60 versus $1.66 in the prior year. This year, the market expects an improvement in earnings ($1.80 versus $1.60). The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Real Estate Investment Trusts (REITs) industry average. The net income has decreased by 1.1% when compared to the same quarter one year ago, dropping from $108.44 million to $107.19 million. You can view the full analysis from the report here: VTR Ratings Report Must Read: Warren Buffett's Top 25 Stocks for 2015
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