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Key Factors to Impact Medical Properties (MPW) Q2 Earnings

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Medical Properties Trust, Inc.  (MPW - Free Report) — also known as MPT — is scheduled to report second-quarter 2022 results on Aug 3 before market open. The company’s quarterly performance is likely to have witnessed year-over-year growth in funds from operations (FFO) per share and revenues.

In the last reported quarter, this real estate investment trust (“REIT”), which acquires and develops net-leased hospital facilities, posted a normalized FFO per share of 47 cents, in line with the Zacks Consensus Estimate.

Over the trailing four quarters, the company beat the Zacks Consensus Estimate on one occasion and met the same on the other three, the average beat being 0.54%. This is depicted in the graph below:

Let’s see how things are shaping up before this announcement.

Factors to Note

During the second quarter, MPT is anticipated to have benefited from its premium acute care portfolio, aided by strong operator relationships. MPW is poised to benefit from its inflation-protected leases. Also, its acquisition efforts are expected to have provided support.

The Zacks Consensus Estimate for the rent billed is pegged at $272.45 million for the second quarter of 2022, suggesting an improvement from the prior quarter’s $263.4 million and a significant increase from the year-ago period’s $216.87 million.

The straight-line rent is estimated at $58.98 million, calling for a sequential decline from $61.04 million, but up from the $55.47 million reported in the year-ago period.

The consensus estimate for income from financing leases stands at $51.87 million, suggesting marginal growth from the prior-quarter’s $51.78 million, up from the $50.34 million reported in the year-ago quarter.

The Zacks Consensus Estimate for quarterly revenues is pegged at $396.4 million. This suggests a 3.83% year-over-year increase from the year-earlier quarter’s reported tally.

Before the quarterly earnings release, analysts do not seem optimistic about the company’s prospects as the Zacks Consensus Estimate for the April-June quarter’s FFO per share has remained unrevised at 45 cents over the past month. However, it suggests year-over-year growth of 4.65%.

Here Is What Our Quantitative Model Predicts:

Our proven model does not conclusively predict a surprise in terms of FFO per share for MPW this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an FFO beat. However, that’s not the case here.

MPW currently carries a Zacks Rank #4 (Sell) and has an Earnings ESP of 0.96%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks That Warrant a Look

Here are two stocks from the broader REIT sector — Public Storage (PSA - Free Report) and Host Hotels & Resorts, Inc. (HST - Free Report) — that you may want to consider as our model shows that these have the right combination of elements to report a surprise this quarter.

Public Storage, slated to release quarterly numbers on Aug 4, has an Earnings ESP of +0.31% and carries a Zacks Rank of 3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Host Hotels & Resorts, scheduled to report quarterly numbers on Aug 3, currently has an Earnings ESP of +9.18 % and carries a Zacks Rank of 2.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.


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