I have seen and heard about a wide range of stocks that investment pundits recommend you buy to profit from the recovery from the coronavirus pandemic.
With stock prices zooming higher through 2021, it’s hard to determine which “recovery” stocks still have room to run. Here is one that will do very well in your portfolio.
EPR Properties (EPR) operates as a real estate investment trust (REIT) that primarily owns properties leased to entertainment and “experiential” businesses. The pandemic-triggered shutdown landed directly on EPR’s tenants.
Before the pandemic, EPR spent a decade as an outstanding dividend growth stock. You won’t find many companies with this type of dividend history:
• Monthly dividend payments
• Average yield around 6%
• Annual dividend growth of 7%
EPR had all the characteristics of a buy-and-hold-forever stock until the pandemic moved “forever” to early 2020. EPR suspended dividend payments in April of last year.
EPR owns movie theaters and seven other types of experiential real estate properties. As a REIT, EPR owns the properties and collects the rent or lease payments. Here are the property types and percent of revenue produced by each:
In August 2021, EPR restarted monthly dividends at a $0.25 per share rate. At the current $50.50 share price, EPR yields 5.9%, right at the historical average. Here are the catalysts for EPR to outperform over the next year or longer.
For the 2021 third quarter, EPR collected 90% of contractual cash revenue. That percentage will continue to climb to 100%.
Before the shutdown, the EPR dividend was $0.385 per share. As the company gets back to full cash collection, I expect the dividend to ramp up from the current $0.25 to its pre-crash rate.
EPR shares traded in the high $70s, pre-crash. A growing dividend plus the market pricing this stock to yield 6% means the share price will continue to appreciate.
After more than a half spent in relative isolation, many people are clamoring for experiential activities. The properties EPR owns offer entertainment choices near where people live. Movies, restaurants, and other entertainment venues are roaring back.
Now, through the crash and recovery, I provided recommendations to my Dividend Hunter subscribers on when to sell EPR and when to get back in. I did the same for all the stocks on the Dividend Hunter high-yield investments list.
If you want to get those updates, as well as the full list of 30+ high-yield, low-risk Dividend Hunter stocks, click here for more info.