The stock market’s direction is difficult to predict. Who knows? One day it’s up 200 points, the next… Medical Properties Trust (MPW 1.4%) and Physicians Realty Trust (DOC 1.15%) are healthcare companies that all provide dividend yields of 5% or more if you’re searching for a decent spot to store your money at a rate that better keeps up with inflation.
Both have declined so far this year, offering a chance to invest right now in reputable businesses that will reward your patience by paying you (in dividends) as you wait for their shares to increase. Both are profitable, and according to price-to-earnings (P/E) ratio and other metrics, they now seem like good deals.
Medical Properties anticipates further expansion.
The shares of Medical Properties Trust have decreased by more than 30% this year. The organization, a real estate investment trust (REIT), has 46,000 beds distributed over 440 locations in nine countries and four continents, making it one of the biggest hospital owners in the world.
On August 3, the business released its second quarter results. In comparison to the same quarter last year, when it reported $251 million in FFO and $0.43 per share, it reported funds from operations (FFO) of $275 million, or $0.46 per share. Additionally, sales increased 4.8% from the previous year to $400.2 million. The business maintained its full-year FFO projection of $1.78 to $1.82 per share for the future.
A dividend track record is also being established by Medical Properties. This year, the REIT boosted its quarterly dividend by 4% to $0.29 per share, marking the ninth year in a row that it has risen. As a result, the shares now yield around 6.94%. Given that Medical Properties is a solid REIT with consistent free cash flow, its FFO payout ratio of 63% is relatively secure. The average number of years left on the leases of its tenants is 17.8.
The Medical Properties Trust has had a very successful run. Over the previous ten years, the firm has raised yearly FFO by 881%, demonstrating that it should have no trouble continuing to pay and increasing dividends. Additionally, the company is now trading for a fairly affordable price for a REIT based on its price-to-FFO ratio of 6.9 during the last 12 months.
Physicians Realty Trust continues to be trustworthy
A REIT that specialized in medical office buildings is called Physicians Realty Trust. It owned 289 of these structures as of June 30, and 94.9% of them were leased. With shares down a little more than 3% this year, the company’s stock has suffered less than the other one highlighted.
On August 4, the REIT released its second quarter results. FFO was $0.27 per share compared to $0.26 per share during the same quarter previous year, while revenue came in at $132.2 million, an increase of 17% year over year.
Even though the firm hasn’t raised the dividend in five years and has maintained it at $0.23 every quarter, the yield amounts to 5.08%. The payout ratio of the corporation is 85%, which is within the safe range for a REIT since the dividend has been constant while FFO has increased. Its trailing P/FFO ratio is 9.8, which is somewhat higher than the trailing P/FFO ratio of 6.9 for Medical Properties Trust but is still a great deal.