Innovative Industrial Properties Is A Cautious Buy

Summary

• IIPR remains risky but attractive for cannabis investors after a major price drop, offering deep value compared to peers despite ongoing tenant and industry challenges.
• Recent financials show declining revenue, EPS, and AFFO, with dividend sustainability in question and refinancing risk looming, but the balance sheet remains relatively stable.
• Valuation is compelling at 0.8x tangible book and a 14.5% dividend yield, though a dividend cut is likely; technicals suggest possible further downside but also significant upside potential.
• IIPR is safer than MSOs and preferred over other cannabis REITs for exposure, but investors should consider the Preferred A shares for a more cautious approach with a 9% yield.
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Sckrepka

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.