Why Healthcare Assets Trust Stocks Today

stock Medical Property Trust (MPW 18.80%) Shares of a medical facility-focused real estate investment trust (REIT) surged 18.8% on Monday after announcing a large asset sale.

Medical Properties Trust has announced a major transaction in Utah.

Late Friday, the company said it had sold its stake in five Utah hospitals to a newly formed joint venture with $886 million in investment capital. Medical Properties Trust has an approximately 25% stake in the joint venture, and the fund has purchased a 75% stake. The joint venture also placed new non-recourse secured financing concurrently with the closing of the sale, providing Medical Properties Trust with $190 million in additional cash. In total, the transaction will result in gross cash proceeds to Medical Properties Trust of approximately $1.1 billion.

What’s next for Medical Properties Trust investors?

Medical Properties Trust said the proceeds will be used primarily to reduce outstanding debt, including fully repaying a $300 million Australian term loan due this year and repaying borrowings under its revolving credit facility.

The news comes just days after Medical Properties Trust announced the sale of five facilities in California and New Jersey to Prime Healthcare for $350 million. Less than three weeks later, Medical Properties Trust rebounded after its single largest tenant, hospital operator Steward Health Care, announced a separate agreement to sell its national physician network to a subsidiary. UnitedHealth. Steward Health owes Medical Properties Trust a total of $50 million in unpaid rent as of the end of 2023.

Ultimately, investors are rightfully celebrating Medical Properties Trust’s efforts to selectively sell assets and clean up its balance sheet. Considering this broken stock’s dividend payout is currently around 12.7% per annum, this could prove to be a solid value for investors confident that the business will be able to return to a more stable state in the coming quarters.