II IIPR.PRA Innovative Industrial Properties, Inc. 9.00% Series A Cumulative Redeemable Preferred Stock Loading... : Investor Sentiment and Bull/Bear Views

The author argues IIPR.PRA is a 'screaming deal' because it yields 9.5% cumulatively, trades about 5% below par, and has only about $44 million issued. The thesis rests on the preferred stock being extremely protected by an approximately $1.8 billion equity cushion and $2.3 billion in assets against $340 million of debt, even after marijuana tenant defaults hit about 16% of revenue. The author says the main risk is that the preferred can now be called at any time, but even a call at par would still give a roughly 5% immediate return because it trades below call value.

The author argues IIPR.PRA is a 'screaming deal' because the preferred pays a 9.5% cumulative dividend and trades about 5% below par/call value. The rationale is balance-sheet protection: IIPR has $2.3B in assets against $340M of debt, leaving about $1.8B of equity cushion, so the $44M preferred issuance seems extremely protected even after marijuana tenant defaults hit 16% of revenue. The author states the only real risk is call risk, and if called, the 5% discount to call value still gives a positive immediate return.