Innovative Industrial Properties (IIPR) AI Stock Analysis

• Market Cap: $1.44B
• Dividend Yield: 14.79%
• Average Volume (3M): 264.95K
• Price to Earnings (P/E): 9.9
• Beta (1Y): 1.12
• Revenue Growth: -1.33%
• EPS Growth: -8.62%
• Country: US
• Employees: 21
• Sector: Real Estate
• Sector Strength: 60
• Industry: REIT - Industrial
• EPS (TTM): 1.03
• Shares Outstanding: 28,011,229
• 10 Day Avg. Volume: 220,886
• 30 Day Avg. Volume: 264,949
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.21
• Enterprise Value/Revenue: 5.70
• Enterprise Value/Gross Profit: 6.30
• Enterprise Value/Ebitda: 7.18
• 1Y Price Target: $70.33
• Price Target Upside: 36.17% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5

• Rating: 71 Outperform
• Price Target: $59.00 ▲(14.23%Upside)

Innovative Industrial Properties scores a 71 due to strong financial health and attractive valuation measures, which are offset by technical weaknesses and challenges highlighted in the earnings call. The company's proactive financial management and strategic expansions position it well for future growth, but immediate concerns around tenant defaults and regulatory pressures remain.

Positive Factors

Negative Factors

Cannabis Pricing Pressures

Cannabis pricing pressures persist across all major states which continue to weigh on operator performance.

Dividend Risks

The dividend is expected to be reduced, which may pressure the stock price as dividends provide support for the stock.

Earnings Expectations

Latest earnings call commentary from public operators highlighted expectations that a recovery in the industry has yet to be on the horizon.

Earnings Power

PharmaCann, IIPR’s largest tenant, being in default significantly affects the company's earnings power.

Tenant Defaults

Innovative Industrial Properties declared certain tenants in default and a default on a mortgage loan, which could impact earnings if defaults are not cured.

Innovative Industrial Properties Business Overview & Revenue Model

Company Description

Innovative Industrial Properties, Inc. is a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized properties leased to experienced, state-licensed operators for their regulated medical-use cannabis facilities. Innovative Industrial Properties, Inc. has elected to be taxed as a real estate investment trust, commencing with the year ended December 31, 2017.

How the Company Makes Money

Innovative Industrial Properties generates revenue primarily through leasing its properties to tenants in the regulated cannabis industry. The company's primary revenue stream is rental income, which comes from long-term, triple-net lease agreements with state-licensed cannabis operators. These leases typically include annual rent escalations, providing consistent and growing income. Additionally, IIPR benefits from property acquisitions and sale-leaseback transactions, where it purchases facilities from cannabis operators and leases them back, thereby providing capital to these operators. The company's focus on the burgeoning cannabis sector and its strategic partnerships with experienced operators are significant factors contributing to its earnings.

Innovative Industrial Properties Financial Statement Overview

Summary

Innovative Industrial Properties maintains a strong financial position with impressive profit margins and efficient cash flow generation. The company effectively manages debt levels, supporting stability and growth potential. However, attention to revenue growth is necessary to sustain long-term profitability and shareholder value.

Income Statement

Innovative Industrial Properties demonstrates strong profitability with consistent gross and net profit margins. The TTM gross profit margin is 90.44% and net profit margin is 50.30%, indicating robust cost management and profitability. Despite a slight decline in revenue from the previous year, the company's EBIT and EBITDA margins remain impressive at 52.60% and 79.30%, respectively, reflecting efficient operational performance.

Balance Sheet

The company's balance sheet is solid, with a low debt-to-equity ratio of 0.15, indicating prudent financial leverage. The equity ratio stands at 81.68%, showcasing strong ownership of assets by equity holders. Return on equity is also competitive at 7.98% for the TTM period, reflecting effective use of shareholders' capital. However, modest growth in stockholders' equity warrants attention.

Cash Flow

Cash flow health is robust, with a significant operating cash flow to net income ratio of 1.57, suggesting effective conversion of income into cash. The free cash flow has grown positively, with a TTM free cash flow of $241 million, indicating ample liquidity to support operations and growth initiatives. Consistent positive free cash flow contrasts with earlier years, showing a strong turnaround.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	308.52M	309.51M	276.36M	204.55M	116.90M
Gross Profit	280.05M	284.61M	265.84M	200.11M	111.94M
EBITDA	248.72M	248.88M	230.92M	177.15M	97.76M
Net Income	161.66M	165.59M	154.39M	113.99M	65.73M
Balance Sheet
Total Assets	2.38B	2.39B	2.41B	2.08B	1.77B
Cash, Cash Equivalents and Short-Term Investments	146.25M	140.25M	87.12M	81.10M	126.01M
Total Debt	297.87M	300.88M	301.50M	326.09M	137.75M
Total Liabilities	441.99M	438.12M	452.94M	472.90M	243.11M
Stockholders Equity	1.94B	1.95B	1.96B	1.61B	1.52B
Cash Flow
Free Cash Flow	258.45M	255.54M	-139.75M	-185.79M	-419.01M
Operating Cash Flow	258.45M	255.54M	234.13M	188.75M	110.81M
Investing Cash Flow	-56.00M	-6.79M	-396.20M	-384.09M	-1.03B
Financing Cash Flow	-197.90M	-195.63M	164.22M	155.76M	924.99M

Innovative Industrial Properties Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 51.65
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IIPR, the sentiment is Negative. The current price of 51.65 is below the 20-day moving average (MA) of 53.73, below the 50-day MA of 54.44, and below the 200-day MA of 69.28, indicating a bearish trend. The MACD of -0.84 indicates Positive momentum. The RSI at 37.17 is Neutral, neither overbought nor oversold. The STOCH value of 19.19 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IIPR.

Innovative Industrial Properties Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PLYM	79 Outperform	$662.49M	4.72	26.05%	6.67%	-3.48%	615.20%
REXR	74 Outperform	$8.50B	26.72	3.74%	4.72%	13.66%	11.34%
IIPR	71 Outperform	$1.44B	9.88	7.78%	14.79%	-1.33%	-8.62%
STAG	71 Outperform	$6.56B	27.22	6.89%	4.32%	8.56%	22.20%
Sector *	66 Neutral	£909.93M	14.33	2.69%	5.94%	14.24%	75.26%
LXP	64 Neutral	$2.29B	28.01	4.15%	6.90%	6.64%	210.89%
ILPT	59 Neutral	$356.22M	―	-16.16%	1.49%	0.36%	11.92%

Innovative Industrial Properties Corporate Events

Innovative Industrial Properties Holds Annual Stockholders’ Meeting

On June 11, 2025, Innovative Industrial Properties, Inc. held its annual stockholders’ meeting where key decisions were made, including the election of five directors and the ratification of BDO USA, P.C. as the independent accounting firm for 2025. The meeting also included an advisory vote on executive compensation, reflecting the company’s ongoing governance and operational strategies.

The most recent analyst rating on (IIPR) stock is a Sell with a $70.00 price target. To see the full list of analyst forecasts on Innovative Industrial Properties stock, see the IIPR Stock Forecast page.

Innovative Industrial Properties Expands Equity Distribution Agreements

On May 13, 2025, Innovative Industrial Properties, Inc. and its operating partnership expanded their equity distribution agreements by including Stifel, Nicolaus & Company, Incorporated and A.G.P. / Alliance Global Partners as additional sales agents and forward sellers. This expansion allows the company to offer and sell shares of its common and preferred stock, with approximately $479.8 million remaining available for sale, potentially enhancing its financial flexibility and market positioning.

The most recent analyst rating on (IIPR) stock is a Sell with a $70.00 price target. To see the full list of analyst forecasts on Innovative Industrial Properties stock, see the IIPR Stock Forecast page.

Innovative Industrial Properties Reports Q1 2025 Results

Innovative Industrial Properties, Inc. reported its first quarter 2025 results, highlighting total revenues of $71.7 million and net income of $30.3 million. The company faced challenges with tenant defaults, impacting revenue, but continued to expand its portfolio with new leases and property acquisitions, reflecting ongoing efforts to strengthen its position in the regulated cannabis industry.