EPR Properties’ 2025 Q4 Call: Genting Deal Necessity and Larger Deal Participation Signals Clash

Date of Call: Feb 26, 2026

Financials Results

• Revenue: $183M for Q4, up from $177.2M in the prior year
• EPS: FFO as adjusted per share $1.30, up 5.7% YOY; AFFO per share $1.30, up 6.6% YOY

Guidance:

• FFO as adjusted per share guidance of $5.28 to $5.48, representing ~5.1% increase at midpoint.
• Investment spending guidance of $400M to $500M for 2026.
• Disposition proceeds guidance of $25M to $75M for 2026.
• Percentage rent and participating interest guidance of $18.5M to $22.5M.
• Q1 2026 results expected to be lower than full-year divided by 4 by about $0.11 per share.
• AFFO payout ratio expected to remain about 70% based on midpoint of guidance.

Business Commentary:

Strong Financial Performance:

• EPR Properties reported an FFO as adjusted per share increase of
  5.1%
  and AFFO per share increase of
  6.2%
  for the fourth quarter.
• This growth was driven by durable tenant performance, steady consumer demand, and strategic capital recycling.

Portfolio Expansion and Diversification:

• The company expanded its portfolio with the acquisition of a 5-property portfolio of championship golf courses for
  $90.7 million
  and a regional water park for
  $23.2 million
  .
• These transactions were aimed at further diversifying and strengthening the experiential portfolio, particularly in the fitness and wellness space.

Increased Investment Spending:

• EPR Properties announced increased investment spending guidance for 2026 in the range of
  $400 million to $500 million
  .
• The increase is attributed to a robust pipeline of high-quality experiential investments and strong relationships with operators.

Balance Sheet Strength:

• The company's net debt to annualized adjusted EBITDAre was
  4.9x
  at year-end, below the lower end of their targeted range.
• EPR Properties bolstered its financial flexibility with a
  $550 million
  public debt offering and an
  $400 million
  at-the-market equity program.

Dividend Increase and Capital Recycling:

• EPR Properties announced a
  5.1%
  increase in its monthly dividend to common shareholders.
• The increase reflects confidence in the earnings trajectory and is supported by capital recycling efforts that have unlocked capital for higher-returning investments.

Sentiment Analysis:

Overall Tone: Positive

• "The fourth quarter capped a year of solid execution and clear progress toward accelerated growth." "Our resilient portfolio benefited from durable tenant performance and steady consumer demand contributing to strong financial performance." "We are pleased to announce a 5.1% increase to our monthly dividend." "In 2026, we expect to increase our investment spending materially... which should result in another year of strong per share earnings growth." "We are excited about our investment pipeline, our balance sheet and the team to create value out of this combination."

Q&A:

• Question from Michael Goldsmith (UBS): Consistent with last quarter, where you pointed to $400 million to $500 million in acquisitions, you put this out formally with your guidance. Can you just talk a little bit about what you're targeting, what you have line of sight in because it represents an acceleration. So just trying to get a sense of what you're looking at, what you have line of sight and just your confidence level of hitting that $400 million to $500 million in acquisitions?
  Response: Management expressed high confidence in hitting the guidance, citing a strong pipeline built over multiple years and success in exceeding targets historically.

• Question from Michael Goldsmith (UBS): And then second question, just Topgolf is one of your top tenants and they've been taken private by private equity. Have you had conversations with Leonard Green and just trying to get an understanding of what they're going to do with the company now that they have their hands on it and just the path and your comfort level with your specific locations that you own?
  Response: Management reported positive conversations with Leonard Green Partners. The new owner is aligned with EPR's view on measured growth (3-5 units/year) and will continue refresh programs benefiting EPR.

• Question from John Kilichowski (Wells Fargo): My first question is just on where you see your cost of capital today. You're trading back close to a range where we were end of the third quarter. When does it start making sense to tap the ATM.
  Response: Management sees cost of capital in the low-to-mid 7% range, which provides a nearly 100 bps spread over debt costs. They are opportunistic but do not need to issue equity as they will be below target leverage without it.

• Question from John Kilichowski (Wells Fargo): And maybe just along the same lines, if we could do sort of a sensitivity analysis, let's say, if your cost of capital got 50 bps better from here on a blended basis, where does that take maybe the high end of your investment guide, if this is a better buying opportunity here. I'm just curious how much more you think you could do if you just had a little bit of improvement on that cost of capital?
  Response: Management declined to speculate on a linear sensitivity, emphasizing that investment decisions are based on the right risk-return opportunities and expressed excitement about the opportunity set and trending cost of equity.

• Question from Bennett Rose (Citigroup): I was just wondering if you had any updates on what's going on in Sullivan County in terms of the ability to sell the ground lease that kind of came up a while ago?
  Response: Management stated there have been no meaningful conversations with the operator regarding the ground lease, and it is not part of their current plan.

• Question from Bennett Rose (Citigroup): And then I was just wondering, when we look in a sort of theme park world, there seems to be I guess, a certain amount of disruption going on and some new management changes. I'm just wondering, are they kind of showing up on your radar screen as a possible solution to some of the issues they might be facing?
  Response: Management indicated that potential management changes in theme parks are on their radar and that they partner with many of the names being discussed, viewing the business as stable and cash cow-like.

• Question from Anthony Paolone (JPMorgan): Just, Greg, going back to the opportunity set that you talked about, can you be a little bit more specific and maybe how much of it is development, redevelopment versus buying existing assets? And maybe kind of the range of cap rates and like what would take you into the 8s versus where you'd probably be maybe in the 7s if something is perhaps a bit higher quality or different?
  Response: Management expects early 2026 opportunities to be ~70% acquisitions and 30% development/redevelopment. Most deals are in the 8%+ cap rate range, with lower rates for higher-credit, lower-risk-return scenarios.

• Question from Anthony Paolone (JPMorgan): And then my only other question, maybe for Mark and just on the spending here. If I look at Page 19 of the supplemental, there's about $63 million of spending outlined there. Is that different than the $85 million that you guys talked about in the presentation? Or do you put those together?
  Response: The $63M on the supplemental relates only to projects started by year-end. The $85M figure includes committed projects not yet started. Adding recent acquisitions like VITAL Climbing Gym brings total spoken-for spending to ~$119M, with more to reach the guidance midpoint.

• Question from Michael Carroll (RBC Capital Markets): I guess, Mark, just sticking with the guidance ranges that you provided in the investment. With that remaining investments to get back up to that $450 million with guidance, when do you assume that gets completed? Is it just kind of ratably throughout the year? Or do you kind of have a back-end weighted? What's kind of implied in that guidance range?
  Response: Management stated the remaining investments to reach the midpoint are weighted more towards the first half of the year.

• Question from Michael Carroll (RBC Capital Markets): And then on the Regal percentage rents what you put in guidance, what did you assume would be the box office, at least for the Regal lease year ended July 2026 versus the prior year? Is it kind of a similar box office, so we're expecting percentage rents for Regal to be kind of in line with what it was last year?
  Response: Management expects Regal percentage rents to be up slightly (~2%) for the lease year ending July 2026, consistent with analysts' expectations, though the lease year does not capture the full fall season.

• Question from Michael Carroll (RBC Capital Markets): And then just last one for me. I know, Greg, you mentioned and talked a little bit about the investment opportunities you have across all your property types. I mean are there any specific property types where you're seeing bigger opportunities or other types of activity that you could pursue?
  Response: Management highlighted fitness & wellness, Eat & Play, and attractions as the top opportunity areas, with golf, climbing gyms, and hot springs being active within fitness & wellness.

• Question from Upal Rana (KeyBanc Capital Markets): Just curious on how the transaction market looks like in terms of larger deals. Are you seeing more or less out there?
  Response: Management believes they are seeing more ability to participate in larger deals, which aligns with their goal of returning to a trajectory of delivering outsized shareholder value.

• Question from Upal Rana (KeyBanc Capital Markets): And then it looks like negotiations start to begin to start up again on SAG-AFTRA with the contracts that were negotiated in '23, expiring in May for writers and in tune for the actors. So the environment is certainly much different today than it was 3 years ago. So I just wanted to get your take on those negotiations and how that could play out?
  Response: Management views the negotiations as early-stage but believes all parties want to avoid a strike similar to the negative impact seen in 2023, with the issue of AI likely to be a key framework topic.

• Question from Jana Galan (BofA Securities): I know this is a much smaller part of your portfolio, but curious if you could just provide an update on the education portfolio and kind of any changing trends there between early childhood and the private school.
  Response: Management stated the education portfolio has continued its strength and may become a focus for disposition activity in 2026, potentially providing another lever to accelerate growth.