We came across a bullish thesis on Medical Properties Trust, Inc. on Value Degen’s Substack. In this article, we will summarize the bull’s thesis on MPW. Medical Properties Trust, Inc.’s share was trading at $4.4200 as of 19th June. MPW’s trailing and forward P/E ratios were 6.72 and 6.67, respectively, according to Yahoo Finance.
Medical Properties Trust (MPW) has begun receiving rent from Steward’s bankrupt hospitals, starting at 25% and ramping up to full payments by October 2026. This creates a synthetic rent growth trajectory over the next 18 months, providing a substantial tailwind for MPW’s share price. The $160 million in new rents equates to around 6.5 cents per share quarterly, significantly boosting funds from operations (FFO), which stood at 14 cents last quarter.
Although recently refinanced debt has cost shareholders around 2.5 cents per share quarterly, the full impact likely hasn’t been realized yet. By October 2026, FFO is projected to exceed 19 cents per share, well above the current 8-cent dividend. At a 10% yield, that implies a share price of $7.60, comfortably above current levels. Management’s stock-based compensation also won’t vest until shares trade above $7 for 20 consecutive days, adding further incentive.
Historically, MPW traded at a 5% yield in a zero-rate environment, but even an 8% yield would justify a $9.50 share price. The worst may be behind the company, with the more amicable Prospect bankruptcy now unfolding. Asset monetization opportunities from former Steward hospitals remain unexplored, and management could soon announce dividend hikes now that restrictions are lifted. Additionally, rents are inflation-linked, with a 2.8% increase being applied this year.
While refinancing older low-interest debt may be costly in a high-rate environment, new refinancing opportunities could lower costs over time. With growth initiatives resuming and positive catalysts ahead, MPW presents an appealing opportunity over the next 18 months.
Previously, we covered a bullish thesis on Omega Healthcare Investors, Inc. (OHI) by NotFunnyLikeHaHa in May 2025, which highlighted its strong dividend yield and demographic tailwinds. The company’s stock price has depreciated by approximately 1.12% since our coverage, as the thesis didn’t fully play out. Unemployed Value Degen shares a similar outlook but emphasizes MPW’s near-term rent recovery and refinancing potential.
Medical Properties Trust, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 19 hedge fund portfolios held MPW at the end of the first quarter, which was 16 in the previous quarter. While we acknowledge the risk and potential of MPW as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.
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