The company recently overcame a major operational hurdle and there is a sense of optimism in the air.
Friday was a quiet day for news, Medical Properties Trust (MPW 13.75%)the latest analyst moves on the stock motivated investors to jump into the stock. As a result, shares of this specialized real estate investment trust (REIT) soared during the trading session. They ended the day up nearly 14%, outperforming the 0.5% gain. S&P 500 index.
A good deal will generate positive reactions
Two Medical Properties Trust specialist analysts issued new opinions on the stock on Friday, with the more influential of the two being Colliers Securities' David Toti, who upgraded his recommendation on the REIT to Buy from Neutral and set a price target of $6.50 per share.
Toti's colleague, Michael Lewis of Truist Securities, has also grown decidedly more optimistic about Medical Properties Trust's future, raising his price target 20% to $6 a share from $5.
The timing is no coincidence: Both moves came just days after news that Medical Properties Trust had reached a settlement with its most troubled tenant, financially troubled Steward Health Care, which filed for Chapter 11 bankruptcy protection in May. Under the terms of the deal, the REIT will regain control of 23 properties leased by Steward. It has already secured new tenants for 15 of the properties.
Required Exit
The deal with Steward marks a milestone in lifting a burden for Medical Properties Trust. Tenant bankruptcies were a major factor in the REIT's significant decline in popularity, but satisfactory resolutions have and will continue to motivate investors to reassess their views of the company.
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has investments in and recommends Colliers International Group and Truist Financial. The Motley Fool has a disclosure policy.
