UPDATE: Compass Point Upgrades Innovative Industrial Properties (IIPR) to Buy
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Compass Point analyst Merrill H. Ross upgraded Innovative Industrial Properties (NYSE: IIPR) from Neutral to Buy with a price target of $175.00 (from $100.00).
The analyst comments "We are raising our rating from Neutral to Buy for two reasons: the company entered into a conditional, confidential settlement with its California tenant that has been in default of its lease terms since July, and the company increased its quarterly dividend from $1.75 to $1.80. We think the increase in the dividend sent a signal that management is confident of its ability to collect lease payments from its tenants, though we note that we do not know the terms of the conditional settlement. Because this contract in particular seems to be enforceable and because the tenant agreed to the settlement ostensibly because the properties are essential to their operations, we are making the generous assumption that each of the other leases, not only in CA but throughout IIPR's portfolio, will prove enforceable. We are raising our price target from $100 to $175, which reflects a 1.4x premium to forward YE2022 NAV, which we adjusted after the dividend announcement and the 8-K filing,"
Shares of Innovative Industrial Properties closed at $91.46 yesterday.
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