EPR Properties (EPR) valuation after new experiential acquisitions, $400m equity raise and reaffirmed dividends
EPR Properties (EPR) just doubled down on its experiential real estate strategy by funding new golf and water park acquisitions with a fresh $400 million equity program, while still affirming steady monthly and preferred dividends.
See our latest analysis for EPR Properties.
The market seems to be weighing that expansion push against dilution risk, with EPR’s share price at $50.23 and a year to date share price return of 14.21% but a stronger five year total shareholder return of 123.62%. This suggests long term momentum remains intact even as near term sentiment cools.
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With shares trading at a double digit discount to analyst targets and cash flows set to grow from new experiential assets, is EPR still mispriced by a cautious market, or already reflecting its next leg of expansion?
Most Popular Narrative Narrative: 13.9% Undervalued
With EPR closing at $50.23 against a most popular narrative fair value of $58.35, the story leans toward upside if the forecasts stick.
The company's conservative balance sheet (net debt to EBITDAre at the low end of targeted range, well covered dividend, minimal near term maturities) and readiness to pursue larger, accretive deals (enabled by improved equity valuation and ATM program) places EPR in a strong position to capitalize on future opportunities from urban or suburban redevelopment trends, supporting FFO and NAV per share growth over the medium to long term.
For readers curious how modest revenue growth, rising margins and a lower future earnings multiple can still support a higher fair value than today, the full narrative walks through the underlying calculations.
Result: Fair Value of $58.35 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, that upside depends on experiential demand holding up. Persistent streaming pressure, weaker tenants or higher funding costs could quickly squeeze rents and growth.
Find out about the key risks to this EPR Properties narrative.
Build Your Own EPR Properties Narrative
If you see the story differently or want to stress test the assumptions yourself, you can build a fresh narrative in just a few minutes: Do it your way.
A great starting point for your EPR Properties research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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