Why Medical Properties Trust Stock Cratered Another 28.4% in August
Shares of Medical Properties Trust (NYSE: MPW) tumbled 28.4% in August, according to data provided by S&P Global Market Intelligence. That sell-off pushed the hospital-focused real estate investment trust's (REIT) share price down by more than a third this year and nearly 70% off its all-time high.
Several factors weighed on the healthcare REIT last month, including its second-quarter results, a report that an important deal with a key tenant was on hold, and a long-expected dividend cut.
Medical Properties Trust's sell-off began shortly after the company reported its second-quarter results. Investors didn't like the news that the healthcare REIT had agreed to participate as a lender in an asset-backed credit facility with top tenant Steward. It opted to invest up to $140 million into the facility, or less than 25% of the total. Investors saw that as a high-risk deal since private credit providers and not banks backed the facility. Further, it increased the company's exposure to that financially challenged tenant. Investors also didn't like what they heard on the company's second-quarter conference call, including that the dividend could be on the chopping block.
Source Fool.com
