2024-07-18 20:39:02 ET
Summary
- Our analysis has been critical of Medical Properties Trust's tenants, particularly Steward Health, which filed for Chapter 11 bankruptcy in May.
- We developed Cash EBITDA to assess MPW's financial health, revealing a significant decline from $1253M in Q4 2021 to $743.41M now, highlighting the company's financial challenges.
- Our assessment indicates that asset overvaluation concerns make MPW’s NAV a potentially unreliable measure of market value, underscoring investor misconceptions.
- We review MPW’s recent refinancing actions and explain why we believe the company, despite recent actions, will still face significant liquidity challenges beginning in 2025.
- Our valuation models indicate MPW's fair value significantly below its current share price, with equity potentially worthless at higher cap rates, leading us to downgrade MPW to a Strong Sell.
Investment Thesis
It has been a tough year for Medical Properties Trust ( MPW ), since the largest tenant, Steward Health, filed for Chapter 11 bankruptcy in May. We've particularly had a contrarian stance on the company, given as we pointed out the financial challenges multiple of their tenants have been facing....
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For further details see:
Medical Properties Trust: The Endgame Unfolds