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INTERVIEW: Primary Health Properties Gilt edged rent collector – accelerating dividends

Primary Health Properties Plc (LON:PHP) is the topic of conversation when Mike Foster joins us to talk about his latest research note. Mike explains what it is that Primary Health Properties does, why the government pay upward only rents, what rents are being paid, why research indicates rent rises may be accelerating, when we can expect to see this, other factors involved, dividends and yield and the risks involved.

 

Primary Health Properties Plc rental income is effectively entirely HM Government underwritten and PHP’s unbroken dividend growth is in its 21st year. In May 2017, PHP acquired its 300th primary care centre and now has 305. In 2018E, debt-financed investment continues in UK and Republic of Ireland (the latter on yields well above 6%). Interim results announced 27th July showed an acceleration in the rate of rent rises agreed (with more to come) and reduced cost of debt. We see good scope for acceleration in dividend growth, albeit 2018E may focus also on raising its cover.

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