EPR PROPERTIES (EPR): what the price requires

The current priced-in claim for EPR PROPERTIES (EPR) is temporarily suppressed because the live engine record is unavailable. The dated report remains a snapshot, not a current market read.

Generated: 2026-07-19 · Source: https://boothcheck.com/report/EPR

Headline

FieldValue
TickerEPR
CompanyEPR PROPERTIES
Current price$59.60/sh
CompositionExperiential 95% / Education 5%

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basisreit
Price-to-FFO10.9x
FFO yield9.2%

The price sits below what even a 5%/yr funds-from-operations decline would warrant; the inversion reports a bound, not a solved growth path.

Solve inputs: computed at a 9.7% cost of equity with 4% terminal growth over a 5-year stage.

How unusual the bet is: within-range

ReferenceValue
vs own history-0.60σ
cohort percentile (of 88 peers)17
implied end-window share0%

Valuation X-Ray

The price is supported by earnings-power and relative-multiple and growth-DCF value. A value/asset-supported name, not a pure growth bet.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset1.39x5expensive
Earnings1.01x3expensive
Relative0.77x6justifies
Growth1.15x4expensive

Families that justify the price: Earnings, Relative, Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 6.1%); the inversion above states its own rate.

Per-Model Detail (n=18)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$53.981.10xyesFCF base $0.3B, growth 3% (input: historical growth), terminal g 2.7%, WACC 6.1%, 5yr projection
DCF Exit MultipleGrowth$50.241.19xyesExit EV/EBITDA: 10.7x / 12.7x / 14.7x (bear / base = today's held flat / bull), 5yr
Relative ValuationRelative$133.810.45xyesP/E 25.35x (blended: static sector reference 35x + trailing (TTM) 11x), scenarios: 21.3x / 25.4x / 29.4x (bear / base = reference held flat / bull), EV/EBITDA 20x
Simple DDMGrowth——no—
Two-Stage DDMGrowth$88.330.67xyesStage 1: 9% for 5yr, Stage 2: 3.5% perpetual
Simple Excess ReturnAsset$38.371.55xyesBV/sh $30.25, ROE (TTM) 11.7%, ke 9.3%
Two-Stage Excess ReturnAsset$42.981.39xyes5yr excess ROE then converge to ke=9.3%
Discounted Future Market CapGrowth$36.951.61xyesRev $0.7B, growth 3% (input: historical growth; tapered), Terminal P/S: 5.3x / 6.3x / 7.3x (bear / base = today's held flat / bull, cap 8x)
Peter Lynch Fair ValueRelative$65.760.91xyesFFO/share $5.48, growth 9% (input: historical FFO/share growth, 10y median), PEG=1.81 (Overvalued)
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings$31.641.88xyesNormalized EBIT (5y avg op income, one-time charges added back) $0.35B × (1−1%) / WACC 6.1% → EPV (no growth)
Residual IncomeAsset$43.911.36xyesBV $30.25 + 5yr PV of (ROE (TTM) 11.7% − Kₑ 9.3%) × BV; BV grows 7.6%/yr
Graham NumberAsset$61.070.98xyes√(22.5 × FFO/share $5.48 × BVPS $30.25) — Graham's conservative floor
EV/EBITDA RelativeRelative$115.760.51xyesEBITDA $0.59B × sector EV/EBITDA 20.0x
FCF YieldEarnings$0.015960.00xyesFCF $261.4M / Kₑ 9.3% — zero-growth perpetuity (excluded from median)
SBC-Adj FCF YieldEarnings$0.015960.00xyesSBC-adj FCF $0.25B (FCF $0.26B − SBC $0.02B) capitalized at Kₑ (excluded from median)
Ben Graham FormulaEarnings$124.080.48xyesFFO/share $5.48 × (8.5 + 2×9.3%) × (4.4 / 5.3%)
ROIC-Justified P/BAsset$9.556.24xyesBV $30.25 × (ROIC 1.9% / WACC 6.1%)
P/Sales SectorRelative$56.781.05xyesRevenue $0.72B × sector P/S 6.0x
PEG Fair ValueRelative$76.110.78xyesFFO/share $5.48 × (PEG 1.5 × growth 9.3% (input: historical FFO/share growth, 10y median)) → PE 13.9x
Earnings YieldEarnings$59.241.01xyesFFO/share $5.48 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative$77.760.77xyesFFO/share $5.48 × 14.2x P/FFO (route cohort median, n=85); FFO $0.42B (FFO incl. D&A + impairments, FY2025, companyfacts), shares 77M
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Net debt (REIT basis)$2.9b
Net debt / FFO6.82x
Fixed-charge coverage (FFO basis)4.1x
Funds from operations (trailing)$420.0m
Share count CAGR (dilution)0.5%
Burning cashno

REIT basis: leverage is read against funds from operations (FFO), not depreciation-gutted operating income. The header's implied growth runs on ADJUSTED FFO — FFO minus recurring maintenance capex — so the header's multiple and this leverage ratio use bases that differ by that capex; neither substitutes for the other.

Bullet Takeaways

Bull Case

The balance sheet is where EPR's recovery quietly finished, and it tells you how much confidence management has in the cash flows underneath. Net debt sits at about $2.86 billion, roughly 6.8 times funds from operations, with fixed-charge coverage of 4.1 times. For an experiential landlord that spent the pandemic with its theatre tenants closed, that is a conservative capital structure, not a stretched one. The dividend math reinforces it: the monthly payout was raised 5.1% to $0.31 per share, $3.72 annualized, against an AFFO payout ratio near 70%. Paying out roughly seven dollars of every ten of adjusted cash flow leaves the other three to self-fund development and absorb a tenant stumble without touching the equity market. A REIT that can grow the dividend and retain that much cash is signaling that the rent is real.

The business itself is a focused underwriter rather than a generic property collector. EPR assesses each deal against a stated framework that, in its own words, screens for "Experiential Alignment • Proven Business Model • Enduring Value • Addressable Opportunity" on the industry side and "Location Quality • Competitive Position • Location Rent Coverage • Cash Flow Durability" on the property side. That discipline shows in the redeployment: first-quarter investment included a $34.5 million fitness and wellness acquisition, and the company is closing most of a $315 million attraction portfolio from Six Flags. The shift away from pure cinema toward fitness, attractions, and other out-of-home experiences is a deliberate diversification of the tenant base while staying inside the experiential thesis.

The cash generation is running ahead of plan. First-quarter AFFO reached $1.29 per share, up 6.6% year over year, and management raised full-year FFO-as-adjusted guidance to a $5.37 to $5.53 per share range while lifting investment-spending guidance to $500 to $600 million. The throughput in the underlying assets is improving too: North American box office gross rose sharply in the quarter, and the filing notes roughly 15 million tickets sold weekly in North America in 2025, with management's view that "the evolution in theatres and enhanced customer experience will continue to bring customers back". Buy EPR and you are buying about a 9% adjusted-cash-flow yield from a landlord whose tenants are filling their seats again, funded by a balance sheet built to take a punch.

Bear Case

The structural truth a holder would rather not face is that the cinema exposure never fully went away, and the price now credits the recovery rather than discounting the risk. EPR remains, at its core, a landlord whose largest single category is movie theatres, in a business where the 10-K itself frames the question of whether streaming permanently shrinks the audience: consumers, it concedes, "have the option of watching" at home. Management's answer is that 15 million tickets a week and a strong recent box office prove the format endures. That may be right. But the bear case does not need theatres to collapse; it only needs the audience to plateau or drift, because a single-format concentration means one secular trend can pressure a meaningful slice of the rent roll at once. Diversifying into fitness and attractions reduces that over time, but it does not erase the cinema weighting that exists today.

The valuation makes the recovery the consensus, not the upside. The units price at roughly 11 times adjusted funds from operations, an AFFO yield near 9%. That is supported by the peer-multiple lens and broadly fair on the earnings-power lens, meaning the market is no longer demanding a discount for the experiential risk. When the value methods already defend the price, the cushion for disappointment is thin. If box-office momentum fades, or if a major attraction or fitness tenant struggles, the cash flow that justifies the 9% yield softens, and a yield-buying shareholder base reprices quickly. The cost of equity the model uses is about 9.7%, which is the market's own statement that this is not a low-risk REIT despite the clean coverage.

Leverage and the capital model are the third pressure. Net debt of about 6.8 times FFO is reasonable for the sector, but an experiential REIT grows by buying assets, and its growth depends on access to capital the company explicitly notes is "beyond our control, including conditions in equity and credit markets." The $500 to $600 million of planned 2026 investment, including the Six Flags attraction portfolio, has to be funded, and a REIT issuing equity to grow at a high cost of capital dilutes the per-share AFFO it is trying to compound. The model carries this in the dilution assumption already. The bear is not that EPR is fragile; it is that the price assumes the experiential thesis keeps working AND that capital stays cheap enough to fund the build, and both have to hold for the 9% yield to grow rather than merely persist.

Valuation

Read on the metric that governs a REIT, the price is undemanding. EPR trades at about 11 times adjusted funds from operations, an AFFO yield near 9%. What the price is betting is modest: it embeds steady, low-single-digit growth in that cash flow rather than a re-rating, and it sits below the level that even a gentle decline in the cash stream would warrant. For a landlord whose adjusted cash flow grew 6.6% per share in the most recent quarter, the implied bar is one the business is currently clearing.

The methods agree more than they usually do for a recovery name. Peer-multiple comparisons land above today's price, the earnings-power lens sits right at it, and the cash-flow approaches also reach it. When peer multiples, earnings power, and discounted cash flow all support the price together, the read is a value-supported income name rather than a stretched growth bet. The one lens that prices EPR richer than its peers is the asset value lens, which credits the underlying real estate above the current quote, a reminder that the experiential portfolio carries replacement value the public price does not fully reflect. The spread across the methods is narrow, which is itself the signal: there is no single family screaming that the price is wrong in either direction.

Solvency is the load-bearing element for any experiential REIT, and EPR's is sound. Net debt is about 6.8 times FFO with fixed-charge coverage of 4.1 times, and the AFFO payout ratio near 70% means roughly 30% of adjusted cash flow is retained to fund development rather than raised externally. The growth model still leans on external capital for the larger acquisitions, and the filing is candid that capital access depends on "conditions in equity and credit markets," so the cost of that capital is the variable to watch. The decisive point is the durability of the rent: at a 9% adjusted yield with coverage that survived the worst stress test the format has faced, the price is paying for continuation, and the demonstrated cash flow is currently delivering it.

Catalysts

The Q1 2026 print, reported in early May, was the central recent catalyst and it beat on the metrics that matter for a REIT. AFFO reached $100.1 million, or $1.29 per diluted share, up 6.6% year over year, and management raised full-year FFO-as-adjusted guidance to a $5.37 to $5.53 per share range. The board increased the monthly common dividend 5.1% to $0.31 per share, $3.72 annualized, while keeping the AFFO payout ratio near 70%. The underlying demand signal was strong: North American box office gross rose roughly 25% in the quarter, a direct read-through to the theatre tenants that anchor the portfolio.

Capital deployment is the forward driver. EPR raised 2026 investment-spending guidance to $500 to $600 million and disposition proceeds to $50 to $100 million, and is closing most of a $315 million attraction portfolio acquired from Six Flags, alongside a $34.5 million fitness and wellness acquisition completed in the first quarter. The pattern is deliberate: redeploying capital into attractions, fitness, and other out-of-home experiences widens the tenant base beyond cinema while staying inside the experiential mandate.

The two things to watch into the next prints are whether box-office strength persists rather than reverting after a strong quarter, and whether the larger acquisitions can be funded without diluting per-share cash flow given that REIT growth depends on capital-market access. Confirmation that the Six Flags portfolio closes on terms and that occupancy across the diversifying tenant set holds would support the case that the 9% adjusted yield grows rather than merely holds.

Peer Cohorts (Per Segment, With Filing Citations)

Experiential (reported)

Education (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

Q1 2026 earnings release

View the full interactive EPR report on boothcheck