Analyzing Medical Properties Trust (NYSE:MPW) and National Health Investors (NHI)

Medical Properties Trust (NYSE: MPW) and National Health Investors (NYSE:NHI) are both mid-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, earnings, dividends, institutional ownership, profitability, analyst recommendations and risk.

Institutional and Insider Ownership

82.1% of Medical Properties Trust shares are held by institutional investors. Comparatively, 69.1% of National Health Investors shares are held by institutional investors. 1.0% of Medical Properties Trust shares are held by company insiders. Comparatively, 5.2% of National Health Investors shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Medical Properties Trust pays an annual dividend of $0.96 per share and has a dividend yield of 7.7%. National Health Investors pays an annual dividend of $3.80 per share and has a dividend yield of 4.8%. Medical Properties Trust pays out 115.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. National Health Investors pays out 97.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Medical Properties Trust has raised its dividend for 3 consecutive years and National Health Investors has raised its dividend for 7 consecutive years.

Profitability

This table compares Medical Properties Trust and National Health Investors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Medical Properties Trust 42.25% 7.54% 3.83%
National Health Investors 59.24% 12.56% 6.38%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Medical Properties Trust and National Health Investors, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Medical Properties Trust 2 4 6 0 2.33
National Health Investors 1 3 2 0 2.17

Medical Properties Trust presently has a consensus price target of $14.11, indicating a potential upside of 12.80%. National Health Investors has a consensus price target of $79.25, indicating a potential upside of 0.79%. Given Medical Properties Trust’s stronger consensus rating and higher possible upside, analysts plainly believe Medical Properties Trust is more favorable than National Health Investors.

Risk & Volatility

Medical Properties Trust has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500. Comparatively, National Health Investors has a beta of 0.56, meaning that its stock price is 44% less volatile than the S&P 500.

Earnings & Valuation

This table compares Medical Properties Trust and National Health Investors’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Medical Properties Trust $610.24 million 7.46 $501.71 million $0.83 15.07
National Health Investors $263.75 million 12.22 $257.02 million $3.89 20.21

Medical Properties Trust has higher revenue and earnings than National Health Investors. Medical Properties Trust is trading at a lower price-to-earnings ratio than National Health Investors, indicating that it is currently the more affordable of the two stocks.

Summary

National Health Investors beats Medical Properties Trust on 9 of the 17 factors compared between the two stocks.

About Medical Properties Trust

Medical Properties Trust, Inc. is a real estate investment trust (REIT). The Company focuses on investing in and owning net-leased healthcare facilities across the United States and selectively in foreign jurisdictions. The Company’s segment is its investments in healthcare real estate, including mortgage and other loans, as well as any equity investments in its tenants. The Company conducts its operations through MPT Operating Partnership, L.P. The Company acquires and develops healthcare facilities, and leases the facilities to healthcare operating companies under long-term net leases. The Company makes mortgage loans to healthcare operators collateralized by their real estate assets. As of February 24, 2017, the Company’s portfolio consisted of 232 properties, including 215 facilities (of the 220 facilities that it owns) were leased to 30 tenants, five were under development, and the remaining assets were in the form of mortgage loans to four operators.

About National Health Investors

National Health Investors, Inc. is a self-managed real estate investment trust (REIT) specializing in sale-leaseback, joint-venture, mortgage and mezzanine financing of need-driven and discretionary senior housing and medical investments. The Company is engaged in the business of owning and financing healthcare properties. Its portfolio consists of lease, mortgage and other note investments in independent living facilities, assisted living facilities, entrance-fee communities, senior living campuses, skilled nursing facilities, specialty hospitals and medical office buildings. Its other investments include marketable securities and a joint venture structured to comply with the provisions of the REIT Investment Diversification Empowerment Act of 2007 (RIDEA) through which it invests in facility operations managed by an independent third party. As of December 31, 2016, it had investments in real estate, mortgage and other notes receivable involving 205 facilities located in 32 states.

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