Medical Properties Trust Faces Risk Of Earnings Dilution Despite New Tenant Leases, Analyst Says
Portfolio Pulse from Lekha Gupta
Medical Properties Trust (MPW) faces potential earnings dilution despite new tenant leases. Colliers Securities upgraded MPW to a Buy with a $6.5 target, while Truist Securities raised its target to $6 but maintained a Hold rating. A global settlement with Steward Health Care covers 23 hospitals, with new leases expected to generate $160 million annually by Q4 2026. However, refinancing activities may dilute earnings, with a projected 39.9% decline in FFO per share in 2024.
September 13, 2024 | 7:21 pm
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Medical Properties Trust (MPW) received a Buy rating from Colliers with a $6.5 target, but faces potential earnings dilution from refinancing. New leases are expected to generate $160 million annually by Q4 2026.
The upgrade to a Buy rating and increased price targets are positive, but the anticipated earnings dilution from refinancing activities offsets this. The new leases provide future revenue, but the impact on short-term stock price is neutral due to mixed signals.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100