Gaming & Leisure Properties, Inc. (GLPI) stock intrinsic value fair value estimate & owner earnings analysis

Gaming and Leisure Properties owns the land and buildings under 69 casinos and related facilities across 20 states and leases them to operators under long-term triple-net leases, meaning the tenant pays for maintenance, insurance, taxes and utilities. About 97% of cash rent comes from five tenants: PENN, Caesars, Boyd, Cordish and Bally's. Growth comes from contractual rent escalators and from funding tenants' projects. Earnings level. We measure owner earnings as operating cash flow, less working-capital swings, less stock compensation, less maintenance capital spending. Because tenants bear maintenance, true maintenance spending is tiny (about $0.2 million in 2022); the roughly $304 million spent in 2025 on projects such as Bally's Chicago, Casino Queen Marquette and Bally's Baton Rouge is development spending that creates new rent, so we treat it as growth spending rather than a cost of standing still. On that basis owner earnings per share were $3.31 (2021), $3.50, $3.72, $3.77 and $4.00 (2025). We anchor on the median of 2021-2025, $3.72 per share. 2020 ($1.82) is excluded: casino closures at the company's own operated properties during COVID cut cash flow sharply, although every contractual rent was still collected. Years before 2021 include that operating business and describe a different company. Growth check. Owner earnings per share rose about 6.2% in 2025 ($4.00 versus $3.77). Our base case assumes only 2% in year one. That is below the recent pace because much of recent growth came from acquisitions and funded projects that we do not count until completed, and because the lower-cost debt described below will have to be refinanced. Base case, about $54.9 per share. Rent escalators (up to 1.25%-2% a year by lease, several requiring rent coverage of at least 1.8x, which the PENN leases met at 1.86x and 2.12x at September 30, 2025) lift per-share owner earnings 2% a year for ten years. The main PENN leases run to October 2033 with three five-year renewals, so we then hold earnings flat through year 25 and assign no value beyond that. Not credited: the $940 million Bally's Chicago funding commitment ($201.6 million drawn), the $700 million Bally's Lincoln call right, and other listed commitments (Aurora, Council Bluffs, Virginia, Sacramento). These depend on tenants drawing funds and on how the company finances them; the spread over its borrowing cost is small per share, so we leave it out. Bear case, about $40.5 per share. The company carries $7.28 billion of debt. Notes of $700 million each at 4.0% (due 2030 and 2031) and $800 million at 3.25% (due 2032) must be refinanced; at roughly 6% that costs about $50 million a year, or around 4.5% of owner earnings. Escalators are assumed blocked for four years by coverage tests, and at the 2033 expiry of the main PENN leases one large lease resets about 13% of owner earnings lower. Earnings then stay flat until 2048, the end of the renewal terms, after which we assume nothing. Bull case, about $61.2 per share. Escalators are earned at the top of their ranges and the funded commitments are drawn on schedule, adding roughly 3.5% a year for ten years, then flat through year 25. What could make this wrong: a large tenant, especially a highly leveraged one, failing to pay rent; a sharp rise in refinancing costs; or the shares issued to fund acquisitions diluting existing holders (already reflected in the per-share figures). We did not have the latest quarterly report available to review, so the analysis rests on the FY2025 annual report filed February 2026.