Why Medical Properties Trust Stock Is Soaring Today
Shares of Medical Properties Trust (NYSE: MPW) were soaring 10.9% higher as of 10:59 a.m. ET on Thursday. This marked the second consecutive day of solid gains for the stock after the Federal Reserve indicated that interest rate cuts could be on the way next year.
Granted, this week's rebound doesn't come anywhere close to offsetting Medical Properties Trust's year-to-date decline of close to 50%. However, it's certainly welcome news for shareholders of the beaten-down stock.
There's a straightforward reason investors are now taking another look at Medical Properties Trust. The company is organized as a real estate investment trust (REIT). REITs are especially sensitive to interest rate moves. When rates go up, their costs of borrowing can increase, thereby impacting earnings and growth. When rates come down, borrowing costs can fall, boosting earnings and opening up opportunities for more robust growth.
Source Fool.com
