Dividend Coverage: This Specialty REIT has a Dividend Yield of 5.80%; Will Trade Ex-Dividend on October 30, 2017
LONDON, UK / ACCESSWIRE / October 26, 2017 / Pro-Trader Daily takes a closer look at EPR Properties (NYSE: EPR) as the Company's stock will begin trading ex-dividend on October 30, 2017. In order to capture the dividend payout, investors must purchase the stock a day prior to the ex-dividend date that is by latest at the end of the trading session on October 27, 2017. Are you looking for research on dividend stocks, if so register with us now for your free membership at:
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Dividend Declared
On October 16, 2017, EPR Properties announced that its Board of Trustees has declared its monthly cash dividend to common shareholders. The dividend of $0.34 per common share is payable November 15, 2017, to shareholders of record on October 31, 2017.
EPR Properties' indicated dividend represents a yield of 5.80%, which is substantially above the average dividend yield of 3.10% for the financial sector. This Company's annualized dividend has increased 6.25% over prior year and represents its 7th consecutive year with an annual dividend increase.
Dividend Insights
EPR Properties has a dividend payout ratio of 79.1%, which indicates that the Company distributes approximately $0.79 for every $1.00 earned. The dividend payout ratio reflects how much amount a company is returning to shareholders versus how much money it is keeping on hand to reinvest in growth, to pay off debt, and/or to add to its cash reserves.
According to analysts' estimates, EPR Properties is forecasted to report earnings of $3.48 for the next year compared to the Company's annualized dividend of $4.08. One of the primary reasons for the difference between earnings and annualized dividend is that EPR Properties is a Real Estate Investment Trust (REIT) which is structured by law to distribute at least 90% of earnings. Moreover, since REITs generate income from owning portfolios of investment real estate, they are likely to have higher depreciation charges.
Since depreciation is a non-cash charge, it does not directly impact the ability of dividend the Companies can distribute. For this reason, Fund from Operations (FFO) is calculated by adding depreciation and amortization to earnings and subtracting any gains on sales which then provides a better picture of any company's profitability and capacity to pay and to sustain dividends.
EPR Properties' net income available to common shareholders was $74.6 million, or $1.02 per diluted common share, for Q2 2017 compared to $49.2 million, or $0.77 per diluted common share, for Q2 2016. The Company's FFO as adjusted for the reported quarter was $94.9 million, or $1.29 per diluted common share, compared to $74.7 million, or $1.17 per diluted common share, for the prior year's same quarter. The FFO indicates that the Company should be able to comfortably cover the dividend payout.
As of June 30, 2017, EPR Properties had a net debt to adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) ratio of 5.28x. The Company had $70.9 million of unrestricted cash on hand and no balance outstanding under its $650 million unsecured revolving credit facility at June 30, 2017. During Q2 2017, the Company prepaid in full four mortgage notes payable totaling $30.2 million, which were secured by four theatre properties. In addition, the Company prepaid in full a mortgage note payable of $87.0 million that was secured by 11 theatre properties. The Company's strong financial position indicates its ability to absorb any fluctuations in earnings and cash flow and to sustain the dividend distribution for a long period.
Recent Development for EPR Properties
On October 12, 2017, EPR Properties announced that it will release its third quarter 2017 financial results after the market close on November 08, 2017 at approximately 4 p.m. EDT. Management will host a conference call to discuss the Company's financial results at 5 p.m. EDT on the same day.
About EPR Properties
EPR Properties is a specialty REIT that invests in properties in select market segments which require unique industry knowledge, while offering the potential for stable and attractive returns. The Company's total investments exceed $6.3 billion and its primary investment segments are Entertainment, Recreation, and Education. EPR Properties adhere to rigorous underwriting and investing criteria centered on key industry and property level cash flow standards.
Stock Performance
At the close of trading session on Wednesday, October 25, 2017, EPR Properties' stock price fell slightly by 0.59% to end the day at $69.41. A total volume of 469.28 thousand shares were exchanged during the session. The Company's shares are trading at a PE ratio of 20.44 and have a dividend yield of 5.88%. At Wednesday's closing price, the stock's net capitalization stands at $5.13 billion.
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