What happened
The latest investor update from Medical Properties Trust (MPW -1.51%) published on Tuesday clearly impressed the market. Following the release of the document, the real estate investment trust's (REIT) share price leaped nearly 6% higher. That was far higher than the 0.2% increase of the bellwether S&P 500 index on the day.
So what
In the 12-page document, Medical Properties Trust laid out a case for investors to come back to the stock, which has generally been in a slump since the beginning of the year.
Augmented by a raft of graphics and charts, the document argues that the REIT is notably undervalued, is performing well despite criticism from investors and analysts, and is not guilty of some of the more pointed accusations leveled at it.
Over the past few months, investors have been particularly concerned with the solvency of Medical Properties Trust's tenants. Several in particular are considered to be problematic -- Pipeline Health declared bankruptcy last October (although it exited the process the following January), Prospect Medical Holdings was behind on its rent payments, and Steward Health Care apparently struggled with debt refinancing.
Addressing that issue, the REIT wrote in the update that it should be mitigated by its "careful lease structuring and effective portfolio management." It went on to say that it is using various methods to alleviate these challenges, such as diversifying its tenant lineup.
Now what
Meanwhile, on the back of its struggles and general investor bearishness, Medical Properties Trust's share price decline has boosted its dividend yield significantly. The REIT made sure to emphasize its payout in the update, pointing out that it now stands at over 14% -- comparing very favorably to the 5.8% average of a selected group of peers.
