Medical Properties Trust: Fundamentals Support A Higher Valuation For This High-Yield REIT
ฝัง
- เผยแพร่เมื่อ 23 พ.ค. 2023
- I originally posted a video covering the hospital REIT Medical Properties Trust on February 17, 2023 when the price was $12.96. On February 28, 2023, I did a follow-up update video after the price had fallen to $8.72. In both of those videos I suggested that the fundamentals supported a higher valuation. Nevertheless, the stock price fell to as low as $7.10, and now trades at $7.88.
Here are two links to the previous videos on MPW:
fastgraphs.com/blog/medical-p...
fastgraphs.com/blog/update-me...
As a result, the most common question I receive from subscribers is do I still like MPW. Additionally, the second most common question I get is can I please do another update on MPW. This has been somewhat frustrating because the only thing that I have seen that has changed materially is the price. From a fundamental point of view, things have actually improved but that has not shown up in the company’s valuation.
As a value investor that believes in investing in great businesses at valuations (prices) that are at least equal to but preferably below the intrinsic value of that business, I have not trusted stock prices, especially short-term prices. Businesses take time to generate value for their shareholders and that time is measured in years, in business cycles, not weeks or months.
Therefore, I would argue that not enough time has passed to make a judgment on whether (or not) MPW is or has been a good investment or not. Thus far, the company has maintained their dividend and fundamentals indicate that it is well covered. But since the stock price has fallen so precipitously, the yield has ballooned to a one time over 15% and currently sits about 14%.
With this video we will cover why we still believe this company has merit regardless of a dividend cut or not. Furthermore, we believe the business is strong enough and possesses significant long-term opportunity to make it a very attractive stock at these levels. We will make our case as clearly as possible with this video. Finally, to answer the questions asked by many subscribers, yes, we still believe MPW is tremendously undervalued at these levels.
Here is the link to the full article:
fastgraphs.com/blog/medical-p...
Sign up for your 7-day free trial:
www.fastgraphs.com
SUBSCRIBE To Our TH-cam Channel
Disclaimer: FAST Graphs is a tool designed to reveal and present information related to financial data and investment metrics. It is not intended to provide specific advice or recommendations. Instead, it offers a comprehensive view of relevant data, empowering users to make informed decisions based on their own analysis. It's your first step to a more comprehensive research and due diligence process. In short, it is a tool to think with. The opinions in this video are for informational and educational purposes only and should not be construed as a recommendation to buy or sell the stocks mentioned.
#dividends #REITs #investing - แนวปฏิบัติและการใช้ชีวิต
Thanks for the update Chuck! Always nice to see you cover MPW
100% agweed! 👌
@@LouieTheLip Yes, excellent analysis of the fundamentals by Chuck here; looks like a fun wave to ride, particularly considering there is no evidence of a drastic dividend cut coming at any point.
I like MPW.
The Managers of MPW also heavy Invested themselfs with their Money.They will do everything to Stable the Situation.
I have now 400 Shares thats enough for me.
Next Week i get Cash from work and buy UGI Shares(New Position for me).
Ty Chuck and stay Healthy
Yeah but they don't buy one stock at this low price so this is a warning in my opinion
Thank you for revisiting this stock. 🙂
Cost basis of about $9.50 and added it to Roth IRA so no taxes on the dividends. Within 3-5 years could turn out rly nice, but plenty of risk also. Thanks for the video and analysis!
Thank you so much for doing this in depth analysis. I bought MPW recently and then the share price plummeted and I started thinking I made a huge mistake. Your analysis is very reassuring. Thanks again!
Thank you! Long MPW. 😊
Great informational video. I doubled up my large position this morning.
Started acquiring this stock slowly starting at $8
Started at like 16$ after covid up to 24$...
Biggest position and still average at 14$...
@@yaykruser I got the drip set.
Thank you chuck. I'm buying every week.
Check this update out from the company: medicalpropertiestrust.gcs-web.com/static-files/738bb110-493f-458d-8806-93ee4bdf19d7 regards, Chuck
Nice to hear your son colton. Kinda helps get another style of valuation. Taught him well
Thanks
Helpful - thanks
Again, this is so helpful!!
Thank you for the excellent video
Thank you for realistic overview! I really like it.
Thanks for this Chuck, I have opened a small position at 7,4 $ and I am open to everything, even a potential divident cut. Fingers crossed!
Fingers crossed is not the way to invest in things. If you are not positive don’t invest. Important thing in investing is to build right checklist. Which will help you take right decision. Just 2 cents to think about.
@@ynsam You should probably watch the video again sir. Every decision comes with a risk.
@@ynsamhere is no such thing as “are you positive?” When it comes to stocks. No one but God can be positive.
Love the channel, love FG. Thanky ou so much for your work.
Great, Fastgraphs and Chucks analyses are both very valuable ...
Videos are the best
Great video again! 🙏🏽
Thanks Chuck! Also to your son! If he'd slow down a bit it would be easier to follow his thoughts and explanations (without hitting "pause" all the time) 😉
Hysteria has beaten down this stock way too much. The more people worry about the price, the more likely it is to fluctuate dramatically. If you own MPW, I would suggest that you ignore the happenings and just wait 5 years. This will prevent you from making bad decisions all along the way. Just let it play out.
Hello from France. Thank you very much for your very interesting video. For several months, I have been buying this stock, which seems to me to be undervalued. Thank you for your valuable information.
Nice to see we are some French following Chuck
Thanks for the update i think i will be buying more
Buy and hold 👍a big chance now
Great video chuck
Tks a lot for the videos u make..... and u make a video of CLM...
This is appreciated. Thank you.
I have invested in MPW in all accounts (IRA, Roth, After-Tax) and I am not selling for any foreseeable future. Thank you Chuck for your insight and analysis.
Thanks Chuck and Covin: Loved your analogy with the "shoppers in the departement store" behavior! :-))).
Fundamentals are not so bad according to your analysis and they don't justify such a fall of the stock price, even with the possibility of a 25% decrease of the dividend! I for one would agree for a 25% drop in dividends to give the company breathing space (debt, buybacks...)
There are 2 events that you don't mention as if you thought they had no impact.
1- Top management of the company has massively sold their stocks a few weeks ago.
2- A class action suit is currently being filed against MPW for non-disclosure concerning the financial status of Prospect, one of their main clients.
Indeed, price of stock "is a compulsive liar", and as with all compulsive liars you never know when to believe them or not. But when insiders start to turn their backs on their own business, and risk of non-payment from a major client is alledgedly being hidden, I would think that these two events justify such investors disbelief in the company, regardless the fundamentals.
I would be very interested in your opinion and Covin's. Thank you for your videos.
My experience has been that large sudden movements in stock prices are almost always exaggerated. A sharp down is usually a buying opportunity, a sharp up is usually a selling opportunity,
May need to revisit this one.
Please do another update on MPW
Always great to see another video from you. Could you comment on RJF, it seems to lack long term data and the FCFE seems wonky. Is this accurate or is it because the data is messed up somehow?
Any new on Inside Buyers? Along with the share buybacks would be excelente news 😅 Thank you Chuck & Son for the info, I loved the metaphor ❤
I have 18 months' salary in it, I have a pretty big loss. I'll keep it and believe in it, thank you Uncle Chuck greetings from Hungary.
Hold tight and sell covered calls
Lol
@@crohmer Extra lol Inflation here is 25 %, yet the forint is strengthening against the dollar , because of this, my loss is even greater . I'm glad I made happy C .
8, 8.75, 9.70 purchased shares sold 10,20 , dividend collected 2x. :o) :o) :o) :o)
I will hold on 2 it Thank you 4 your work nice like always
I remember $F cut their dividend and it sent that down to $4 before going to $25 in a few months!
That was during Cvd though....
Yes! I will wait to buy more MPW when they say they’ll cut their dividend will put the stock even lower because of the affraid people
Have been reading you on Seeking Alpha for years and always thought that your surname was pronounced "kar-ne-VAH-le" (four syllables, as in Italian). Now I know I was wrong.
Thanks for the analysis, Chuck!
You are actually correct about the pronunciation in Italian. However, for American purposes we pronounce it the way it looks.😁
Chuck can you pleased do an Evaluation of John Deere? Thanks!
Awesome👍🏻
What about the pending lawsuit for fraud?
I was wondering the same…. And expected this to pass in this video too. Hope Chuck will still address this and share his view on this aspect. I learned never to buy into a lawsuit, especially class-action lawsuits like this is seeming to be one.
Can you revisit AAP
When a company is this undervalued, the only option is a price upside from here. And, a nice dividend while waiting. Thanks Chuck.
No there are two options. First fundamentals will go down to meet share price or fundamentals will stay good and share price will rise. The same like with Stanley Black and Decker where market was somehow right and EPS collapsed instead share price recovery. The same for Intel. My main quastion is how market knew about Stanley if analysts and managment was blindsided by sharp drop.
@@Cap_management Of course the assumption made in my comment is that (hopefully) the fundamentals stay intact. We’ll see.
One of their largest tenants, Prospect, just secured financing from creditors. Hopefully, this will help address concerns regarding that tenant's financial health.
Wouldn't time only tell? If they're still struggling there's nothing stopping them from going through this again. How has there business improved?
What about other tenants as prospects (no pun intended)?
I have been watching MPW since it was in the $20 range. I still haven’t bought. It’s continued to reach lower lows consistently. I think REITs overall are going to continue to decrease in value during this interest hiking period which may have one more rate hike before a pause. I think we’ll see lower lows once again and that is when I’ll buy in and hold forever. Of course just a small portion due to the risks currently. My target price is between $6-6.5/ share
The problem with that is it may never go that low. Around 8.50 a share is good enough for me.
Ok we are at that range now. So now what?
@@Essays4College I’ve been playing the wheel. Only been able to sell the 6.50 puts. Nothing in the money yet. But selling at $7 calls if I ever get assigned. 30% annual income is the target
@@bretthixson8264 I'm right there with you. I wouldn't be surprised if it has further to go. The selling is relentless.
Can you do a video on ICE
Long-term hold for me ,will be rewarded by 1yr
Thanks for the insight Chuck. How about taking a look at Dorian $LPG. I'm heavily invested in them and wonder if a glimpse at the future could be included in one of your future videos?
It may sound weird, but the catalyst for the price going up will probably be the moment of the dividend cut.
You could be right
Sir what do u think about "GROY" ? Can u make a video about this compnay ?
Stock of the Year ;)
Love your videos chuck and you’re one of my favorite TH-cam channels. Do you have an opinion on HPP? It’s a stock I feel is going through a similar issue as MPW with short term headwinds but fundamentals appear quite sound. Thanks!
Sorry, I have not looked at HPP. However, a quick glance suggests that fundamentals are expected to deteriorate further. Moreover, all hospitals are mission-critical, offices not so much. In other words I would be more skeptical of office properties than hospitals. Regards, Chuck
@@FASTgraphs okay good to know. Thanks Chuck!
👍
Thank you Chuck for these great tutorial videos. I am a FASTgraph newly subscriber and wish I had known about it before, I would have saved on unnecessary losses that occurred to me, over the last couple of years. I have a question please: To invest in a company, what is the Growth benchmark to consider for Stocks and REITs? Should we enphasis on the near past (7 to 10 years)? Thank you in advance... Greetings from Beirut!
Thanks for your question. You learn from the past but you invest in the future. Also, the more recent past is more relevant than the long-term historical past. But I always make my decisions based on my best estimates of the future and the valuation that that future represents.
@@FASTgraphs Thank you Chuck for the answer; but what about the Growth benchmark for Stocks and REITs? Would appreciate it if you could address this in one of your upcoming videos, thanks.
Chuck, how do you know when analysts estimates are updated on Fast Graphs ?
Estimates are loaded along with all data continuously.
agreed
Thanks for another really nice video! Maybe one way to look at MPW would be this: say the dividend is reduced by 50%, to $0.58/share/yr. So the yield would be about 7.5%. Would it be a good buy in that case? If there’s some fear that MPW may not be able to maintain the $1.16/share/year payout, surely it could maintain $0.58, and the share price would probably recover after a 50% dividend cut. Thoughts?
It should not need to reduce to even $0.80/year unless there is something we do not know about. The stock used to yield closer to 5% in dividends when the quarterly payout was growing each year.
They can more than pay the dividend. But even if they would reduce it, it would still be a bargain.
Please do ZIM next with same 3-5 years outlook.
Greatly appreciate it!
Dividend trap for the next 20 years.
Outlook for ZIM was about -30% annualy till 2025 if P/E stays the same but since than outlook was cut to losing money so Fastgraph shows nothing. You cant calculate outlook if EPS is negative.
@@Cap_management thank you
What about LNC, could it be 2nd UNM? :)
what about northwest healthcare properties. nwhuf its way down too is this industry related ?
Chuck - have you got chance to screen GPN? According to FG very consistent grower, almost perfect scorecard results, very undervalued - like your type of stock.
GPN is a research candidate on my total return buy list
Damn! I hope Colton is right on this one 💔🤔
It may work out, but mpw has a few concerns. Too much concentration, debt, and some of their tenants are struggling. Also, they are lending money to some of those struggling tenants. In addition, hospitals are poor margin businesses. Lastly, the macro conditions are hurting reits overall. Too much has to go perfect , so the risk/reward is a bit out of wack along with shaky fundamentals. Much better and more stable deals are available. Also, if they were going to do much better, insiders would be buying more, usually. Good luck, everyone.
Perhaps better and more stable, but also perhaps not as opportunistic
Stock is priced for 50% drop in FFO so few concerns are priced in already.
They should do a Dividend cut get people that want to sell give them a reason to. The company then should buy back shares and reinvest into the company..
How did you activate fast graph ???
contact pollyc@fastgraphs.com
@Fastgraphs: Is there any information available about the pending lawsuit for fraud? That would be a disaster tough!
You can Google MPW and lawsuits
Now $6.77 as I type in august 2023
The question is how low can it, or will it, go????
with $MPW recovering over 35pct from the short report induced lows, the real question is at what price would it make sense to sell $mpw once it gets back to 15-20 fair value range? it will be tough to unload a 12-13pct dividend stream- am feeling myself already getting addicted on a cost basis of 9… thoughts? this would
apply across
all good div yielding stocks if one buys them below 1/2 price on mr markets insanity. worth another video chuck???
This is an interesting question. 1st and foremost MPW is an income stock which implies a long-term holding period. However, that statement is only valid as long as fundamentals hold up to include the dividend. On the other hand the excessive low valuation also would indicate this to be a speculative recovery and total return opportunity. Consequently, the income investor would be a long-term holder while the speculator (or short-term trader) might look to make a quick gain. I put myself in the former. Nevertheless, I indicated in past videos that investing strategies and instruments are relative to the goals, objectives, and risk tolerances of each individual. I hope that provides some food for thought. Regards, Chuck
@@FASTgraphs thanks chuck, i’m also in the former category- i think at 16+ i’d consider selling (at least covered calls) unless MPW starts to raise their dividend further. i’m still not clear on my strategy in such a scenario unless there was another mpw-like high-yield safe-ish & way underpriced opportunity to trim mpw to then move into. thx for all you do!
Compro todos os meses 20 novas ações, não vendo por nada.
I bought like 10 shares at $10 and $11 to track it. I can put a bit more into it.
The way I look at it is that it is a stock that went from the lower left of the screen to the upper right and is now tanking for some reason. Is it going out of business? If it is not. Then I can assume it will get back on the gain train and go from the lower left to the upper right.
If it is struggling financially then the REIT will cut dividends and if it does - maybe a 8% yield? That is still solid. I WOULD PERSONALLY LOVE A DIVIDEND CUT because it means they are putting money to work and buying.
I got in.
Perhaps coincidence, is there any correlation between the falling stock price and rising interest rates? Not sure those rates are done going up either.
Yes, I think most REITs were overvalued until interest rates started rising. In other words, I do believe rising rates were the catalyst to bring REITs down to attractive levels.
In will buy when Insider also are buying but not like 10k Dollar but 250k or more😂🎉
fast Graphs, Reits have to pay 90% fund from operation by law, now I do realize that the government says how this is calculated. So given that how much could they cut 15 or 20% or what ?
REITs must spend 90% of their distributable cash by law. But That's a different metric. Nevertheless, the dividend policy is decided by the Board of Directors. I believe Brad Thomas suggested they could cut their dividend by 25% and that could be a very positive catalyst. But all this is speculation at this point. The thing I and most confident in his the MPW will likely be a going concern for years to come. Consequently, long-term investors could be rewarded handsomely.
Errare humanum est, perserverare diabolicum
The only question is whether they're going to cut dividends.
A higher valuation, sure. But a higher price…not so sure.
They never been positive in free cash flow.
Respectfully not sure what you're looking at. MPW free cash flow has been positive since 2012. I am looking at their cash flow statement on their financial statement.
Chuck Is doubling down on this stock Buffett style ?
Wut
영상이후 현재 주가는 반토막이 났다.7.9달러가 저평가라고 믿고 들어갔더라면 지금 4.18달로 반토막(-50%)가 됐을것이다.
well this aged like milk
Cooking the books? The news articles on them in the last 12 months are rather telling.
News articles that are full of repeated speculation and supposition.
@@cliffluxion7019 Just remember these words, “fiduciary responsibility”. They will resonate down the road.
@@guineveregruntle6746 medicalpropertiestrust.gcs-web.com/static-files/738bb110-493f-458d-8806-93ee4bdf19d7
Be careful with this one. The short interest is something like 18 percent. The fundamentals may support a higher valuation but only if the info we are being provided is accurate and is not being manipulated? Why are so many people shorting it otherwise? What do they know other than the issues with Prospect?
Thanks for sharing the positions were covered in the video and the article. Additionally, it appears that MPW management is resolving the issues slowly but surely.
I'm pretty sure they are shorting because of the lawsuit!
Brad has been pumping MPW since it was $22...too much analysis yet you miss the big picture...MPW is a leveraged debt machine that made good money when interest rates were at zero. MPW is rated below junk, treasuries return 5%, so tell me at what rate they have to refinance those 10billion of loans? Now tell me MPW's cap rate...there you go, the whole biz model is broken...interest rate environment since 2008 changed and MPW was leveraged on that old biz model...insiders didn't buy a single share and you think this is one of the best investments today?
medicalpropertiestrust.gcs-web.com/static-files/738bb110-493f-458d-8806-93ee4bdf19d7
98% forward payout ratio based on AFFO. Dividend cut is absolutely coming.. Valuation of course looks cheap.. but income investors just say no...
Thanks for sharing your view
Many REITs had much higher payout ration than 100% AFFO for years and didnt cut. And dividend is not paid from AFFO. Arbor realty has 124% payout and raised dividend recently.
Hahaha you know how many REITS have surpassed 100% and still didn't cut dividends? Study before you give ppl half ass logic smh
@@Cap_management Exactly
MPW Junk now?
I'll pass.
Mr. Valuation is usually correct 98% of the time ? He must declare himself? Does he predict a dividend cut? You can’t have it both ways Chuck? Declare your prediction now 🙏🏽
He convinced me that ohi is a 45 dollar stock when it was 36. I went all in. That was 2.5 years with divendeds I am still down so I kinda hesitant lol. Ohi is 29. But hovers 26-29. So much for 45.
@@Adventure5619 You would be break even if you paid $36 including dividends but not reinvested. With reinvested you would be up around 1.5% per year. $36 was zero margin of safety so you should buy it lower with margin of safety.
@@Cap_management well schwab says differently lol so far with div reinvested I am still down over $ 1300. So 2.5 years of dead money. On my investment. I mean I hold it till I die. But I just have it on drip won’t be adding anymore moving into schd. But I am very hesitant on mpw.
Not talking about their distressed customers is worrisome to say the least. Even when pointed out in comments. I enjoy your channel but listening that you want to stick to the facts and skewing your analysis is a big surprise. Not a nice one.
Perhaps you failed to read the article accompanying this video.
Beware this thing is not what it seems. Falling for a reason
Please tell us what it is then that is not what it seems and why or what reason is it falling? Just saying it don't make it so give us some facts. Regards, Chuck
I do my research you do yours however my main beef is with the management- dig deeper
@@billmeiklejohn1705 typical garbage reply of a shortseller with no details or supporting facts.
Is steward an increase in assets ? 🤔we must be honest here? This company looks like a company performing a fire 🔥 sale?
The "opportunity of a lifetime ".... Bro i suggest you retire from investing
This is what I actually said: "but I intend on owning this stock for years to come I think it's an extreme extremely undervalued Reit and it's an opportunity you might only see once or twice in a lifetime but you have to make that judgment for yourself thanks for watching" Bro I suggest you work on your listening skills and understanding before you make such a rude and unfair comment. Regards, Chuck
haha great accent bruv
Fastgraph is a great tool but still has so much wasted potential. For example price and P/E alerts and notifications are so important thing. Lets say I look at graph of Cigna and find a good entry point at P/E 9 I would like to get notified when stock gets there. Another one is screening tool which I find almost useless now. Why I cant search in preset portfolios like S&P 100? I can choose only Nasdaq or NYSE which is thousand of stocks. Lets say I want to run a search for S&P 500 stocks under P/E 15. It is impossible now.
Another one is a button to switch between reinvested and not reinvested dividends which takes few minutes to implement but instead you are forced to go to settings tab every time and you cannot even confirm it by pressing enter. Im also for putting analysts scorecard back to company info as there is a lot of space to put it there back.
Portfolio page is close to useless too. Why you dont show all popular metrics as default? Like EPS, Dividend, growth rates etc.? If you have dozens of custom portfolios and you need to set every time your columns its very annoying. And I would bet than many people miss that +Create view button and even dont know that you can add columns. I know it I talked to many people using FG and nobody noticed that. I recommended FG to soemthing like 30 people so I have a good feedback what they want or missed when using FG.
Thanks for the feedback we are working on things like that