By Mark Skousen, High-Income Alert

Omega Heathcare Investors (OHI), based in Hunt Valley, Md., is a real estate investment trust (REIT) that provides financing and capital to the long-term healthcare industry, especially skilled nursing facilities.

The company owns or holds mortgages on more than 400 assisted living facilities, nursing homes and specialty hospitals in 35 states. A REIT must pay out at least 90% of its net cash flow in the form of dividends. So, we get an attractive yield here of 8%.

Not only is the yield sustainable, it should grow substantially from here. For the past five years, Omega has boosted its dividend an average of 10% per year. That's five times the rate of the average healthcare REIT.

Some observers will argue that with Medicare reform ahead, a healthcare REIT isn't a good place to invest. I disagree.

With the population greying -- and living longer -- nursing homes and assisted living facilities are going to see a steady influx of business in the years ahead.

One person who agrees with me is the outstanding contrarian investor David Dreman. He owns more than 1 million shares of Omega Healthcare in his DWS Dreman Small-Cap Value Fund.

Why does this market-beating manager own the stock? Only Dreman can say. But note that quarterly earnings at Omega are up 288% on a 13% increase in revenue.

Operating margins top 56%. And the company is in the midst of a $100-million stock buyback program. As a result, now is a good time to take advantage of this low share price and high yield.

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