Medical Properties Trust (MPW 4.00%) is a high-yielding dividend stock -- paying a staggering 13% at the current stock price. But such a high yield is often a sign of investor concern, and indeed investors are worried that this real estate investment trust (REIT) is overly dependent on a handful of tenants. In fact, the company recently noted it had trouble with a large tenant that was not paying full rent.

But there is a sign that things could be improving for the REIT as hospitals -- which are its key tenants -- may start performing better this year.

A top hospital operator just reported encouraging earnings results

The big risk for Medical Properties Trust is whether or not its tenants can continue to pay rent. If they do, then the REIT's payouts will continue, and perhaps the healthcare stock could even recover if the underlying business proves to be stable. 

There is reason for optimism as HCA Healthcare (HCA -0.03%), which runs hospitals and medical facilities across the country, recently reported some positive financial results, suggesting that conditions in the healthcare industry could be improving. HCA isn't listed as a key tenant of Medical Properties Trust, but if its hospitals are doing well, that may be a good sign for the REIT's tenants as well.

For example, a sore spot for hospitals during the pandemic has been the ability to maintain proper staffing levels. Due to shortages, hospitals have had to resort to temporary workers, which often come at a big premium and can significantly weigh down earnings.

On April 21, HCA reported its quarterly earnings for the first three months of 2023, with its net income showing a modest 5% improvement from the prior-year period, reaching $1.5 billion in profit.

The arguably more important development, however, was news that staffing levels are improving. HCA CEO Samuel Hazen says that "as our labor situation continues to get better, we think that will allow us to open up more surgical capacity."

As a result of the stronger outlook, the company raised its forecast for 2023, now projecting its adjusted profit per share will be within a range of $17.25 to $18.55, versus $16.40 to $17.60, which was its previous estimate.

A good sign for Medical Properties

If a top hospital operator such as HCA is seeing greater stability in its operations, that could be a positive sign that Medical Properties' tenants may also benefit from similar trends, particularly in having better and more predictable staffing levels. 

The healthcare industry has been struggling for years due to the pandemic, and with the public health emergency set to expire this month, there could finally be a real return to normal for hospitals and the industry as a whole.

It doesn't mean that simply because HCA has been doing better that all of Medical Properties' tenants will have stronger financials, but it is a positive sign nonetheless for a REIT that depends on the strength of hospitals, which account for the vast majority of its portfolio.

Is Medical Properties Trust a buy?

Medical Properties Trust does appear to be a slightly safer buy than it was even a week or two ago with these developments.

However, this is still not a stock that I would consider purchasing right now. The REIT still doesn't have a big buffer in terms of earnings as its funds from operations (FFO) per share were just $0.31 for the period ending March 31, which included a write-off of unbilled rent that cost the company $0.07 in per-share profit. And at $0.31, its FFO is barely higher than the REIT's quarterly dividend payment of $0.29. 

That's not enough room for investors to feel too comfortable with the stock and its dividend. And even if the dividend may be safe for the time being, Medical Properties Trust has a horrible track record as an investment, which should encourage you to be extra cautious. While things could be improving for the REIT, investors shouldn't be rushing to add the stock to their portfolios just yet as the risk isn't gone.

At the very least, you should consider waiting another quarter or two to see if the REIT's financial situation improves.