2024-01-23 17:25:31 ET
Summary
- EPR Properties primarily invests in experiential real estate, with 92% of their investments in properties such as theaters, amusement parks, and cultural properties.
- The company's stock has performed well, generating returns 4x higher than other REITs in the past year.
- EPR's payout of 56% is not great and even if management wants to focus on investment growth, we still think it has the elbow room to improve the payouts.
- EPR's stock can be picked up at a 20% discount to other specialized REITs but the discount is justified considering the unremarkable FFO growth prospects in FY24.
- The risk-reward on the standalone charts look encouraging, but EPR's relative strength ratio versus other REITs has already mean-reverted, and the stock may not benefit from rotational interest within the sector.
Company Profile And Performance
EPR Properties ( EPR ) is a 25-year-old net lease operator that primarily dabbles with experiential real estate. Roughly 92% of their total investments are in experiential properties such as theatres, eat and play centers, amusement parks, cultural properties, live venues, casino resorts, experiential lodging, skiing, and fitness & wellness avenues, etc. The non-core part of the portfolio (around 8%) is linked to educational-based real estate, which EPR hopes to dispose of....
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Three Broad Considerations For Those Contemplating A Position In EPR