2024-05-03 19:05:08 ET
Summary
- We initiated IIPR at a Sell due to concerns over tenants' credit profiles and stretched valuation.
- The recent DEA announcement to reschedule marijuana to Schedule III has caused short-lived rallies for producers but more stable gains for IIPR.
- The SAFER Banking Act poses a risk to IIPR's business model and premium valuation, as it could allow producers to access mainstream banking and reduce IIPR's economic earnings.
- Valuation remains highly stretched and we maintain our Sell rating.
Summary
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Innovative Industrial Properties: We're Not Ready To Reclassify