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Strategies & Market Trends : Meditrust NYSE: MT

MT 37.43

+1.5%

3:59 PM EST

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To: Mr. Sunshine who wrote (134)	11/9/1999 9:02:00 PM
From: Charles Holewinski	of 233

Hi Steve, MT just can't cut the dividend 50% and retain REIT status. If they have earnings they must pay out 95% of those earnings. Now how they arrive at the earnings figure of which 95% must be paid out is another story. Seems to me if they choose to use earnings to pay down debt that money would no longer qualify as earnings and therefore not be subject to the 95% rule. I am sure there are other accounting methods which could be used to further reduce the earnings figure. I have seen posts on other boards which suggest that the Bass family or Rainwater is going to wait for this stock to go to go lower perhaps to 3 and then step in an take it over. I don't think this sounds logical given the value present in MT. The re-negotiation of the leases in the troubled nursing home business does sound correct to me and the worst case 50% dividend cut does appear to be just that THE WORST CASE. I would be surprised if management would declare an even lower cut in January after issuing a warning that "A cut of as much as 50% might be warranted." Seems to me that if an even higher cut was possible management would not have mentioned any number.

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