This 11.5%-Yielding Dividend Stock Takes Another Small Step Toward a Stronger Future

Medical Properties Trust (NYSE: MPW) expanded aggressively when interest rates were low. The real estate investment trust (REIT) took on a lot of debt to build one of the world's largest portfolios of hospital real estate. That rapid growth allowed the REIT to grow its dividend.

Unfortunately, the healthcare REIT's strategy backfired when rates surged, and some of its top tenants experienced severe financial issues. As a result, the REIT has had to backpedal by selling properties to shore up its financial situation. It recently took another step forward, which bodes well for its ability to maintain its 11.5%-yielding dividend.

Medical Properties Trust recently announced the sale of the 50-bed Arizona General Hospital in Mesa, Arizona, and seven freestanding emergency department facilities in the Phoenix area. Dignity Health is paying $160 million for the portfolio, which values the properties at a sub-7.5% real estate capitalization rate. Medical Properties plans to use those proceeds to reduce debt and for general corporate purposes.

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Source Fool.com