MPW - Medical Properties Trust's Turnaround Is Here - Initiate Cautious Buy
2024-06-16 10:00:00 ET
Summary
- Steward's bankruptcy is finally here, triggering improved clarity into Medical Properties Trust, Inc.'s ongoing tenant troubles and balance sheet health.
- The long-awaited dividend announcement also implies the management's focus on shareholder returns, with 2024 likely to bring forth higher liquidity at over $2B.
- Medical Properties Trust's portfolio diversification and rental collection from other tenants show promise for future performance as well, further aided by its relatively robust interest coverage.
- Combined with the sustained bullish support observed in its stock prices, we are cautiously upgrading the Medical Properties Trust stock as a Buy.
- It goes without saying that the stock will remain volatile ahead, attributed to its high short interest, upcoming debt maturity, potential capital raises/debt refinancing, and uncertain Fed pivot.
We previously covered Medical Properties Trust, Inc. ( MPW ) in March 2024, discussing why we had maintained our Hold rating then, despite the stock's recent recovery from the January 2024 bottom and the excellent profitability of the REIT's core portfolios.
Much of our pessimism then was attributed to the uncertainty surrounding Steward Health Care System's financial health as the biggest tenant, with the REIT's dividend prospects likely to remain mixed before Steward's June 2024 deadline....
Medical Properties Trust's Turnaround Is Here - Initiate Cautious Buy