MPW Stock: Consider for Its 7.44% High-Dividend Yield
August 1, 2017
MPW Stock Is a Top High-Dividend Stock
When investing in any security, there are three important aspects of a company to consider before deploying any capital: its past, present, and future. This knowledge helps make more informed decisions, which should be reflected in your bottom line. All three will be applied to today’s stock, which features a high dividend and a current yield of 7.44%.
The company in question is Medical Properties Trust, Inc. (NYSE:MPW). Medical Properties is a real estate company involved with healthcare-related properties and investments such as hospitals, medical office buildings, and surgery centers. The benefit of this investment is that you would own real estate assets without the need to serve as a landlord.
However, before even looking into this or any other company, make sure you understand its business model and general operations. To test if you really understand the company, explain it to a non-investor. If they understand, then the company is worth further research; if not, it’s too complicated to be worth your time.
With that out of the way, let’s examine MPW stock across time.
The Past of MPW Stock
The past is a great indicator for the future. However, keep in mind that any and all past returns will not determine how the stock will perform going forward. That said, this step is more about looking at how shareholders have been treated by the company.
When it comes to a company’s history, first look at its prior revenue and margins. There is no need to break down each dollar earned; rather, look at the trends. Medical Properties has been growing year after year, as evidenced by its annual reported revenue growing 169% over the past five years. One main reason for the increase is the addition of several properties to the company’s portfolio in this period. The dividend is paid on a quarterly basis, which means more money to be put towards it due to the growth in revenue. (Source: “Medical Properties Trust Inc.,” MarketWatch, last accessed July 28, 2017.)
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The Present of MPW Stock
The present means understanding what investors currently benefit from and receive. As noted, MPW stock’s current dividend yield is 7.44%, or $7.40 for every $100.00 invested.
At present, Medical Properties owns 225 properties in the U.S., Germany, the U.K., and Italy, with more than 25 tenants having signed lease agreements with the company. The majority of the revenue and properties comes from the U.S.
It is also important to consider if there are any changes occurring within the business, such as a new acquisition or selling of a business division. Of note for Medical Properties was a late-2016 investment of $1.25 billion into nine acute care hospitals managed by by Steward Health Care System LLC. $1.2 billion went towards the facilities, while the remaining $50.0 million was used to acquire an equity investment in Steward itself. (Source: “Medical Properties Trust, Inc. Completes $1.25 Billion Investment in Nine Steward Health Care Hospitals,” Medical Properties Trust, Inc., October 3, 2016.)
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The Future of MPW Stock
A future outlook entails looking at how the business will likely fare going forward. What you specifically focus on will depend on the sector. For instance, a pipeline company will be concerned with the price of oil.
Going forward, Medical Properties’ revenue can continue to increase due to population growth. Since 2010, the U.S. population has grown by more than seven percent, with the U.S. Census Bureau predicting the population will grow to over 400 million by 2060 from the current population of 323 million. And since the senior population is expected to see the most growth, an increase in the total U.S. population should mean more demand for the company’s facilities. (Source: “A Look at the U.S. Population in 2060,” United States Census Bureau, December 12, 2012.)
Increased demand for the current properties is also expected. When this occurs, Medical Properties could choose to charge a higher rental fee for those spaces. And of course, buying additional properties is always an option.
Final Thoughts About MPW Stock
As you can see, there are plenty of reasons to be bullish on MPW stock, in addition to it being a solid example of why you should gather as much information as you can before deploying any capital. Personally, by working, I understand the value of the dollar; therefore an investment goal should be to preserve every dollar and see growth over time, which could be offered by MPW stock investment.
