Is Innovative Industrial Properties a Buy?

Innovative Industrial Properties (NYSE: IIPR) is an intriguing stock. The real estate investment trust (REIT) has a price-to-sales valuation of 23 and a price-to-earnings valuation of 60. That is far more expensive than the average 12 times earnings of its REIT peers.

Yet investors don't seem to care at all. Over the past year the stock is up a stunning 242%, far outpacing the S&P500's 69% return over the same period. Just what is behind the hype for such a seemingly overvalued stock?

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Source Fool.com