I wrote this article myself, and it expresses my own opinions. Jussi clearly knows what he's talking about. But the long-term record does appear to be encouraging. Let's not kid ourselves here. I am not receiving compensation for it (other than from Seeking Alpha). Things appear to be OK right now -- the REIT's funds from operations (FFO) per share in its most recent quarter (ended March 31) was $0.31 and were higher than its $0.29 quarterly dividend payment. What Kind Of Shareholders Own Medical Properties Trust, Inc - Nasdaq I am now retired. Before that I was an analyst (operations and financial) and for a short time a Controller I have a B.S. I am not receiving compensation for it (other than from Seeking Alpha). If you have an ad-blocker enabled you may be blocked from proceeding. As a Canadian if I buy this what is the withholding tax on dividends? At the current share price, the company's quarterly dividend of $0.29 delivers a yield of more than 14%. They have historically earned market-beating returns because they each had a unique approach. My earlier update for MPW published on December 19, 2022 focused on Medical Properties Trust's price weakness and potential catalysts. Given that people pay annually escalating insurance premiums regardless of whether they need to seek care at a hospital, the REIT is quite insulated from the economic effects that inflation causes for its tenants, who are themselves somewhat insulated from the effects on consumers. Thanks for the analysis of one of my bigger REIT holdings. The Motley Fool has no position in any of the stocks mentioned. That doesn't bode well for a REIT that already has a slim buffer between its FFO per share and its quarterly dividend. Tough article for MPW in today's WSJ. The Motley Fool has no position in any of the stocks mentioned. Does Medical Properties Trust Have A Good ROE? Asia Value & Moat Stocks is a research service for value investors searching for attractive Asia-listed investment opportunities with a huge gap between price and intrinsic value, leaning towards both deep value balance sheet bargains (i.e. There's simply too much risk here for this to be a tenable investment at a time when many companies are slashing their dividends and with an uncertain future for the economy. Obviously a safety stock, health and reit, hard to see it lose money when the patients beds are filled. as indicated in its FY 2022 results release. Such macroeconomic conditions increase the likelihood that the company will become more reliant on debt to fund its business. I have no business relationship with any company whose stock is mentioned in this article. *Average returns of all recommendations since inception. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. This suggests some credibility amongst professional investors. Medical Properties Trust Earnings Date and Forecast 2023 (NYSE:MPW) They may have great strategies and solid growth but the last couple years in the markets have not been normal and the coming two years are going to head in a different direction. A worsening economy combined with a slim buffer between its funds from operations and its quarterly payout put the dividend at risk. From its inception in Birmingham, Alabama, the Company has grown to become one of the world's largest owners of hospitals with 444 facilities and approximately 45,000 licensed beds in ten countries . Why Medical Properties Trust Is a Retiree's Dream Stock As if often the case, there is another side to the story. I have a high school teaching credential and an MA in Math Education. Medical Properties Trust, Inc., based in Birmingham, Alabama, is a real estate investment trust that invests in healthcare facilities subject to NNN leases. There is no way to know if the deal with CommonSpirit is accretive for Steward. While this group can't necessarily call the shots, it can certainly have a real influence on how the . The company is seeking compensatory and punitive damages from Viceroy, which has published 11 different articles slamming Medical Properties Trust this year alone, saying the REIT is overstating its assets and will have no choice but to cut its dividend. Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. In other words, MPW's bear case AFFO per share should still be sufficient to cover the expected dividend payments for fiscal 2023, considering a reasonably comfortable AFFO dividend payout ratio of 90% ($1.15/$1.29). But Prospect Medical does have assets of substantial value which it can eventually monetize to repay what it owes to MPW. That's not generally an issue if the REIT can earn higher returns than its cost of capital, but because MPW has announced unusually large volumes of new acquisitions, this risk of potential dilution has worried the market. This prospectus relates to 25,411,039 shares of common stock of Medical Properties Trust, Inc. that the selling stockholders named in this prospectus may offer for resale from time to time. The information in his articles and his comments on SeekingAlpha.com or elsewhere is provided for information purposes only. net cash stocks, net-nets, low P/B stocks, sum-of-the-parts discounts) and wide moat stocks (i.e. The bond market is a pretty good indicator of the risk in a stock and right now it's flashing warning signs for MPW, with the debt yielding over 10%. The peer median dividend yield for healthcare REITs is around 6.5%, while MPW's 10-year historical average dividend yield was approximately 6.6%. Medical Properties Trust (MPW) Dividend Yield, Date & History Check Out This $30B Market Now (From Mining Industry Report) Free Stock Report $8.97 +0.29 (+3.34%) (As of 04:00 PM ET) Compare Today's Range $8.65 $9.00 50-Day Range $7.26 $9.35 52-Week Range $7.10 $17.36 Volume 6.67 million shs Average Volume 15.05 million shs There haven't been any insider transactions in the last three months -- that doesn't mean much. Notice that near the top of the cash flow statement above, the large gain of $536,755,000 is removed from the cash flow calculation. Steward Health Care likely would not do the transaction if it was not accretive.Nor would a secured lender like Medical Properties Trust, Inc. allow the transaction. Those who believe that the pendulum will move in one direction forever or reside at an extreme forever eventually will lose huge sums. We are glad that we doubled down when the share price temporarily dipped below $20 per share, but if we had not done so, we would not mind doubling down today at a 15% higher share price. Notably, Prospect Medical's trailing twelve months' EBITDARM (earnings before interest, taxes, depreciation, amortization, rent and management fees) rent coverage ratio was a negative 0.5 times. I have held onto it so far dripping the dividends, slowly lowering my CB, but clench my buttcheeks when I look at the principle erosion. In fact, in 2008, the REIT did slash its quarterly dividend payment from $0.27 to $0.20, and it didn't start to hike the payout again until 2014. That is how this reit grows, but covid will hurt hospitals as they can't survive on Medicaid and Medicare funds. Today, he is the author of "High Yield Landlord - the #1 ranked real estate service on Seeking Alpha. Recommend stocks over healthcare reits as too limited upside. A newbie would think this is the hottest stock/REIT on the planet. Medical Properties Trust has raised its dividend for 11 consecutive years and management knows it can't cut that payout without sending investors sprinting for the exits. I refuse to sell because that will only lock in a loss, but the question is - do I have the fortitude to ride it out for 2-3 years, if not longer, just to see if I can break even? Medical Properties Trust weighs in on multiple lawsuits - Birmingham Do I need to change my perception???? Let me preface by saying that in 2002 when I retired as a broker had you told me some shares would be $2700/share or Chipotle would be $1500 Id have laughed at you. Meanwhile, its net income rose 38% to $903.8 million, or earnings per share (EPS) of $1.50 compared to $656.9 million and $1.11 in EPS in 2021. However, given that its lawsuit against Viceroy calls the short seller's claims baseless, it would be hard for Medical Properties Trust to cut its dividend now. These symbols will be available throughout the site during your session. That means that those costs basically become expenses because a lease is ending. Now let me turn our attention to the operating results of our tenants. Last year, Medical Properties Trust's revenue declined by 0.1% -- not a huge drop -- to $1.542 billion. Happy SWAN investing with the mother of all SWANs. Any comment on WSJ article today? Entering text into the input field will update the search result below. Does Medical Properties Trust's 15% Yield Make It An Attractive And it . So What Does This Data Suggest About Medical Properties Trust Insiders? First, as a REIT, the company is required to distribute at least 90% of its taxable income through dividends every year. We understand healthcare. Sign up here for a free two-week trial. In addition to that, we also highlighted it as one of our Top 5 picks at High Yield Landlord. 1 High-Yield Dividend Stock to Buy Before the Next Bull Market, and 1 to Avoid, Medical Properties Trust Stock: Bear vs. Bull. Smart investors also know that dividend payments can get slashed, put on hold, or left static rather than being hiked, and this business is no exception. But anyone who switches or attempts to switch from those measures by stating they are not all cash needs to then look at where "all the cash is." It's a very good place to be in. Medical Properties Trust offers a consensus forward FY 2023 dividend yield of 15.5% based on its last traded share price of $7.27 as of March 23, 2023. Medical Properties Trust boasts a relatively higher dividend yield than its peers and rivals. Even then, some investors have recently started to question the management mainly due to its exposure to Steward. The transaction put a lot of the cash flow of those hospitals into a far financially stronger entity. And assuming everything is fine could prove to be a costly mistake. Currency in USD 8.97 +0.28 (+3.28%). Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. At the REIT's Q4 2022 results briefing, Medical Properties Trust also highlighted that the lower end of its normalized FFO per share guidance at $1.50 is equivalent to an Adjusted Funds From Operations or AFFO of $1.29 per share. Rates remain high and refinancing debt will hurt them. MPW is a stock with risk and the SP reflects that risk. Medical Properties Trust might maintain its dividend payments and it might be able to weather the storm that it finds itself in. Long term investors who hold their nose and buy should be rewarded. We know hospital needs. It doesn't have to issue stock to fund it's growth. Jim Halley has positions in Medical Properties Trust. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. Please. I had no prior warning, and the only saving grace for me was that I had been holding the stock long enough that after years of high dividend payouts, I didn't end up losing money on my investment, but I very well could have. Looking for more investing ideas like this one? The company announced several senior leadership promotions, but those weren't the reason. Analysts Disclosure: I/we have a beneficial long position in the shares of MPW; VICI either through stock ownership, options, or other derivatives. What date does Medical Properties Trust's (MPW) report Earnings Is this happening to you frequently? Why Medical Properties Trust Stock Is Sliding Today 3 Things About Medical Properties Trust That Smart Investors Know The reason for this is that its business model works by investing large amounts of capital into new properties (or loans backed by properties), and then leasing out those properties to long-duration tenants like hospitals and clinics for an interest rate in the high single-digit percentage point range. ~ Howard Marks. IMO - its to easy right now to short stocks as sentiment on the market is totally bearish. MPW's current consensus forward FY 2023 dividend yield of 15.5% assumes that the REIT pays out a dividend per share of $1.15 for FY 2023 which is just slightly below its FY 2022 dividend payout of $1.16 per share. Medical Properties Trust to Snap up Five Hospitals from Tenet Deinvested all today and rolled into other sectors. Did Medical Properties Trust, Inc. (NYSE:MPW) Use Debt To Deliver Its A new administration would probably be a good thing. If there were doubts about Steward's future ability to pay rent, it wouldn't invest as much into this tenant and wouldn't accept such a low cap rate. Written by Yet, I'm bearish on this stock for the following reasons. (Note: This article was in the newsletter on April 16, 2023.). Took a beating. So far 2019 has been a very active year for the REIT. The net result of all of this to Medical Properties Trust, Inc. should be a minimal overall effect to the reported cash flow and key REIT measurements but a noncash charge to earnings. So, clearly there was enough cash to pay the dividends.". Just another bonus. That means smart investors don't expect Medical Properties' tenants to default at a higher rate than normal in an inflationary economy, at least not for a good while after the onset. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. with an emphasis in Accounting and an MBA (for which I studied Finance, Economics, and Management) I passed the CPA exam on the first try and am a retired CPA in the state of Maryland. Headquartered in Birmingham, Alabama, Medical Properties Trust is one of the largest hospital owners in the world. MPT | Property Map - Medical Properties Trust As a real estate investment company, Medical Properties Trust acquires and develops hospital facilities for leasing on a net rental basis. It might be a buy for me at $21.00. I wonder where the senior management park their spare cash. The bull case scenario implying a normalized FFO per share of $1.65 will only materialize if MPW secures a full-year of interest and rent from the Prospect California properties and half a year's interest and rent from the Prospect Connecticut properties (which are expected to be sold by end-Q2 2023) in 2023. If you are a victim of this type of investor . To report a factual error in this article. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. In other words, MPW thinks that its AFFO per share could potentially fall by -11% from $1.42 in FY 2022 to $1.29 for FY 2023 in a bear case scenario. bullish on MPW as we were back in September. ROE can be calculated by using the formula: Return on Equity = Net Profit (from continuing operations) Shareholders' Equity So, based on the above formula, the ROE for. Invest better with The Motley Fool. Analysts' average estimate for FFO was also $0.47 per share. I have no business relationship with any company whose stock is mentioned in this article. If an argument changes from FFO because FFO is not all cash, then the place to start is with the cash flow statement. MPW has a unique strategy that has resulted in significant outperformance in the past, and we expect this outperformance to only accelerate in the coming years. Guys, here's a tip. For 2022's high-inflation environment, it expects to hike rents by around 4.4%, though it could go higher if necessary. We certainly do, as a lot of you on this call have written about, when we announced the acquisitions, many people were waiting for us to do an equity offering, we believe that the stock has been artificially pressured in that regard. But even before conditions deteriorated, management preemptively slashed the payout. The latest controversy has little to do with cash flow and a lot to do with a non-cash charge. *Average returns of all recommendations since inception. These projections may not compare to analysts' average estimate of $1.85, as the company has elected to exclude certain leases of certain assets. That alone should be enough to generate a double-digit total return over the coming years. Dividend announcement is coming soon, wonder what else that will do the share price. In the 10-year period ending the first quarter of this year, our normalized FFO per share grew at an annualized rate approaching 9%. MPT is currently the second-largest non-governmental owner of hospital beds in the U.S. MPT . Now, when the transaction occurs, the relevant capitalized costs on the balance sheet will be accelerated. Expensive energy bills, the main component of rampant inflation, are pushing central banks to raise interest rates to dampen this rapid rise in the prices of goods and services. The company's decision to jettison some properties may help its bottom line, but it also means it will have less cash flow coming in to pay future dividends. Since year end 2018, MPTs total assets have grown from $8.8 billion to $19.7 billion, company of its kind to focus exclusively on hospital facilities in the U.S. and around the world, owner of hospital beds in the U.S., with approximately 45,000 and a U.S. portfolio of $11.9 billion*, of its kind to invest in hospitals globally currently $7.7 billion invested around the world, compound annual growth since year end 2012 which coincides with MPTs international expansion, 1000 Urban Center Drive, Suite 501 Birmingham, AL 35242. Avoiding this stock for the last 10 years, go me. Medical Properties Trust: The Bottom Is In (NYSE:MPW) A lot of price fluctuations since then. Overall, the company is still pretty healthy, especially as a long-term investment. Announces First Quarter 2023 Financial Results Conference Call and Webcast April 7, 2023 Medical Properties Trust Responds to Wall Street Journal Article March 30, 2023 Medical Properties Trust Files Lawsuit Against Short-Seller Viceroy Research and Its Members, Sends Letter to Shareholders Medical Properties Trust, Inc. 12.93%. Medical Properties Trust, Inc. is a self-advised real estate investment trust formed to acquire and develop net-leased hospital facilities. This justifies my Buy rating for MPW. At 13%, it offers investors a mouthwatering payout, in large part because its share price has tumbled more than 50% during the past 12 months. Want $3,000 in Annual Dividend Income? Analysts Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. If you want to buy a high-yielding dividend stock at a reasonable price, it's still a fairly safe bet, particularly at its current reduced price. The average Medical Properties price target is $22.73, implying 20.7% upside potential. Thanks. But 2021 had a favorable swing of $13,119,000. Dividends paid as shown in the next section of the cash flow report were less than $700 million. MPW wasnt an attractive dividend stock at 7%-14%, so why would it be at 15%??? The new capitalized costs will "soak up" some of the previously capitalized costs that were heading towards expenses on the income statement. Investors should also be aware that Medical Properties' weighted average cost of capital of 5.04% is lower than its return on invested capital of 5.23%, but only marginally. Invest $26,500 in These 3 Stocks. Trick is to move before they do or you lose all your profits. The recovery from the challenges of fiscal year 2020 will continue. None of the bulls on MPW are advocating you putting all your $ in it. But for Oil & Gas Value Research members, they get it first and they get analysis on some companies that is not published on the free site. It will, after all, see the problems ahead before investors see them reported in the financial statements. At first, it may seem that casinos and hospitals have nothing in common, but in reality, they share many similarities. I worked at much larger fortune 500 and other international companies that had only 1 jet, or none. For the first quarter ended March 31, 2022, Medical Properties announced that its net funds from operations (NFFO) was $0.47 per share (up from $0.42 a year ago). MEDICAL PROPERTIES TRUST, INC. - SEC.gov It's important to note, though, that even when one of its tenants filed for bankruptcy, Medical Properties Trust was able to adapt, either by working with the company, selling the property, or leasing it to a new tenant. Medical Properties Trust, Inc. is a self-advised REIT that provides capital to hospitals located throughout the U.S. and other countries. On TipRanks, the company has a Moderate Buy consensus rating based on six Buys, five Holds, and zero Sell ratings. Only reason this yield is so high is because stock price has been decimated by shorts. At the exception of that, the thesis remains intact and we remain just as bullish on MPW as we were back in September. AFFO looks good they said. The Motley Fool has a disclosure policy. MPT | Portfolio - Medical Properties Trust Importantly, this is far from a perfect. Invest $26,500 in These 3 Stocks. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. PR CLASS ACTION ALERT: The Law Offices of Vincent Wong Remind Medical Properties Trust Investors of a Lead Plaintiff Deadline of . I wrote this article myself, and it expresses my own opinions. buying earnings power at a discount in great companies like "Magic Formula" stocks, high-quality businesses, hidden champions and wide moat compounders). MPW Q1 earnings report due next week, which will be very revealing. The net result of some hospitals in Utah changing to CommonSpirit Health is likely to result in a noncash charge for Medical Properties Trust, Inc. CommonSpirit has a lower lease rate due to its financial strength. Or listening to what others have to say. However, looking at the company's situation, a cut is unlikely to happen unless more of its tenants go into default. The Medical Properties Trust lawsuit is one of the hottest issues in the real estate industry today. Type a symbol or company name. While you wait, MPW pays you a 5.1% dividend yield, and it is set to keep growing cash flow at a 5-8% annual growth rate.