2024-01-29 10:58:05 ET
Summary
- Applying the principle of inversion, we question the apparent attractiveness of MPW's 18.35% dividend yield, urging investors to consider potential risks and the possibility of a loss of principal.
- Examining MPW's challenges, we highlight tenant pressures, missed rent payments, and the looming threat of refinancing, emphasizing potential repercussions for the company's financial stability.
- Highlighting Cash EBITDA's importance, we assess its effect on MPW's valuation. With declining Cash EBITDA, potential refinancing challenges and macroeconomic risks, we strongly caution against considering the REIT.
Investment Thesis
Occasionally, when researching potential investments, we tend to invert our way of thinking, as the great investment legend Charlie Munger did . For instance, when we previously looked at Medical Properties Trust ( MPW ), we wondered what could go wrong with the company paying a 13.83% dividend yield and tried to assess whether the return actually justified the risk....
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Medical Properties Trust: Invert, Always Invert