What yield to maturity do these notes represent relative to GLPI's current stock dividend yield and the broader market rates?
Yield‑to‑Maturity (YTM) on the new senior notes
| Tranche | Coupon | Issue price | Maturity | Approx. YTM |
|---|---|---|---|---|
| 2033 Notes | 5.250 % | 99.642 % of par | 8 yr (Feb 15 2023 → Feb 15 2033) | ≈ 5.3 % |
| 2037 Notes | 5.750 % | 99.187 % of par | 12 yr (Nov 1 2025 → Nov 1 2037) | ≈ 5.8 % |
The YTM is derived with the standard bond‑pricing approximation:
YTM ≈ [C + (F‑P)/n] ÷ [(F + P)/2] where C = annual coupon, F = par (100), P = price, n = years to maturity.
Relative to GLPI’s equity dividend yield
GLPI’s REIT shares are currently trading at a dividend yield of roughly 5.5 % (typical for the stock in mid‑2025).
- The 2033 notes (≈ 5.3 %) sit just below the equity yield, while the 2037 notes (≈ 5.8 %) sit a touch above it.
- For a yield‑seeker, the longer‑dated notes give a modest premium over the stock’s cash‑flow return, with the added benefit of a fixed coupon.
Relative to broader market rates
- U.S. Treasury 10‑yr yield is near 4.0 %.
- Investment‑grade senior unsecured corporate bonds are yielding about 5.0 % for comparable maturities.
Both GLPI notes therefore trade at a spread of ≈ 1.3–1.8 % over Treasuries and are in line with, or slightly above, the prevailing corporate‑bond market.
Trading implications
- Attractive fixed‑income entry: The notes’ YTM exceeds the Treasury benchmark and is comparable to the equity dividend, making them a compelling option for yield‑focused investors who prefer credit‑protected cash flow (the notes are guaranteed by GLPI).
- Interest‑rate risk: With 8‑ and 12‑year durations, the notes are sensitive to any upside in rates; a rate‑rise would depress prices, while a flattening or decline would support them.
3 Equity‑credit interaction: The relatively generous YTM may draw capital away from the stock, capping upside on the equity side, but the guarantee and REIT‑style cash‑flow profile keep the two securities complementary.
Actionable take‑away: For a balanced portfolio, consider taking a modest position in the 2037 notes to lock in a ~5.8 % YTM—slightly higher than GLPI’s dividend yield and comfortably above Treasury rates—while monitoring the 8‑year 2033 notes for a lower‑duration, lower‑price‑volatility alternative.