EPR Properties: A Special Place in My Heart

EPR Properties is a real estate investment trust (REIT) that has performed well in the market, despite a recent pullback. The REIT holds a special place in the author's heart, as it is one of the best-performing REITs in their portfolio and was the first business they covered on Seeking Alpha.

EPR Properties (NYSE: EPR), a leading diversified experiential net lease real estate investment trust (REIT), has recently experienced a pullback in its stock price. The REIT, which specializes in select enduring experiential properties, has faced some challenges but continues to demonstrate strong fundamentals and a promising future outlook.

Recent Performance

Over the past couple of months, EPR's stock price has fallen from over $61 per share to approximately $53 per share, representing a double-digit correction. Despite this pullback, EPR remains a top-performing REIT in many investors' portfolios. Since the time of a previous Seeking Alpha article [1], EPR has provided over 34% total return, with 22% resulting from stock price changes and an additional 12 percentage points through dividend payments.

Portfolio Reorganization and Occupancy Rates

EPR has been undergoing a portfolio reorganization, which has led to some investor hesitation. However, the REIT has made significant progress in this area. As of the most recent earnings call, there was just one vacant theatre left with intentions to sell it. In the past four years, EPR has sold 31 theatres and has one remaining vacant theatre. Year-to-date, EPR has sold approximately $130 million of assets, with plans to revise its 2025 disposition guidance to the range of $130 million to $145 million [1].

The occupancy rate, excluding vacant properties intended to be sold, remains high at 99%. EPR currently has 274 properties within its experiential portfolio leased to 52 tenants [1].

Investment Activities

EPR's investment activities have also been robust. While the investment volume during Q1-Q2 2025 was modest at $86.3 million, the management expects a pickup in the second half of the year. The cost of capital has become more attractive, leading EPR to increase its investment spending cadence [1].

Financial Metrics

EPR's financial metrics remain strong. Fixed charge coverage amounted to 3.3x as of Q2 2025, and the dividend yield stands at nearly 6.7%, with a forward-looking AFFO payout ratio of 70% [1]. The stock trades at a forward-looking P/FFO ratio of 10.5x, presenting a potential for double-digit total returns.

Upcoming Events

EPR Properties' Chairman and CEO, Gregory Silvers, will present at the 2025 Citi Global Property CEO Conference on March 4, 2025 [2]. This event will provide investors with an opportunity to hear more about EPR's future plans and strategies.

Conclusion

While EPR Properties has experienced a recent pullback in its stock price, the REIT continues to demonstrate strong fundamentals and a promising future outlook. With ongoing portfolio reorganization, improving investment activities, and robust financial metrics, EPR remains a compelling investment opportunity for investors and financial professionals.

References

[1] https://seekingalpha.com/article/4820222-what-is-going-on-with-epr-properties-in-once-again
[2] https://www.businesswire.com/news/home/20250228261361/en/EPR-Properties-to-Present-at-the-Citi-2025-Global-Property-CEO-Conference