Farmland Partners (FPI) at a glance: 70,400 acres of farmland across 11 US states, price $9.68 against book value of ~$12.17 — roughly a 20% discount to balance-sheet substance. Regular dividend $0.09/quarter ($0.36 annualised = ~3.7% yield), plus irregular special dividends from land sales (2024: $1.15/share, 2025: $0.20/share). I hold 35 shares at approximately -3.1%.
Farmland Partners Inc. (NYSE: FPI) was launched as a REIT in 2014 and is now the only NYSE-listed farmland REIT focused on diversified US agricultural land. The business model is straightforward: FPI buys farmland, leases it to farmers and collects rent. As a REIT the company must distribute at least 90% of its taxable income — hence the dividend.
As of Q1 2026, FPI owns approximately 70,400 acres across eleven US states: Arkansas, California, Colorado, Illinois, Indiana, Louisiana, Missouri, Nebraska, South Carolina, Texas and West Virginia. The portfolio breaks down to roughly 60% row crops (corn, soybeans, wheat, rice, cotton) and 40% permanent crops (almonds, pistachios, citrus, avocados, strawberries). Around 100 different tenants farm the land — broad diversification with no concentration risk from any single lessee.
The hard-asset angle: farmland is a finite resource, historically inflation-resistant and low-correlated with equities and bonds. Buying FPI gives indirect exposure to a diversified pool of American agricultural land — without having to become a farmer yourself. That is the core of the thesis.
The most common mistake investors make with FPI: they see "$0.09/quarter" and calculate a 3.7% yield and call it done. That covers the regular dividend. But FPI has consistently paid special dividends from land sales in recent years that change the picture considerably:
| Year | Regular Div./Year | Special Dividend | Total |
|---|---|---|---|
| 2024 | $0.24 (4×$0.06) | $1.15 (Jan 2025) | $1.39 |
| 2025 | $0.24 (4×$0.06) | $0.20 (Jan 2026) | $0.44 |
| 2026 (current) | $0.36 (ann., after Q2 raise) | Open (Jan 2027) | Still open |
The 2024 special dividend of $1.15 stemmed from the sale of 46 farms for approximately $308 million — at a gain of roughly $51 million above book value (about 20% above carrying value). In 2025, further acreage was sold for $90 million, including a Corn Belt deal at 56% above the 2016 acquisition price. These gains flow largely to shareholders.
Important: Special dividends must not be included in the regular yield. They are not predictable. Anyone buying FPI because of a $1.15 special dividend and expecting the same next year is likely to be disappointed — the 2025 special came in at just $0.20, significantly smaller because fewer acres were sold.
The regular dividend was raised by 50% in Q2 2026 — from $0.06 to $0.09 per quarter. That is a positive signal, but it also shows how low the starting base was. Annualised, the current running yield is roughly 3.7% at $9.68.
The most compelling argument for FPI is the NAV discount. Book value per share sits at approximately $12.17 (FY2025, ~44 million basic shares, total equity ~$538 million). The stock trades at $9.68 — roughly 20% below that.
But the true fair NAV is actually higher than book value. Why? Because FPI consistently sells its farms at meaningful premiums to their carrying values on the balance sheet:
Three data points from real transactions (2023-2025):
— 2023: $195.5M in sale proceeds, $36M gain above book value
— 2024: $308M for 46 farms, ~20% above book value
— 2025: $31M Corn Belt deal, 56% above the 2016 acquisition cost
In every case FPI realised more than the balance sheet showed — the true land value systematically exceeds carrying values.
FPI management describes the company's own stock as "the cheapest farmland we can buy" and has backed that up with action: since late 2024, 2.3 million shares have been repurchased at an average of $12.25 (85% of estimated NAV). In Q2 2025 alone, 2.1 million shares were bought back at $11.19. Over full-year 2025, $38.1 million went into share buybacks — more than was paid as dividends to common shareholders in the same period.
The strategy is consistent: shrink the portfolio, return the proceeds to shareholders (buybacks plus special dividends), until price and intrinsic value converge.
One point that gets glossed over in many FPI write-ups: the regular dividend is not quite fully covered by ongoing AFFO. FY2025 produced AFFO of $0.39 per share. The AFFO guidance for 2026 was subsequently reduced to $0.30–$0.35 (from a prior $0.33–$0.37) — the main driver being higher credit loss provisions in the FPI loan programme ($1.8 million for full-year 2026 versus zero in the original budget).
With annualised regular dividends of $0.36 and AFFO guidance of $0.30–$0.35, the payout ratio runs at roughly 103–120%. In plain terms: FPI is temporarily distributing more than the running AFFO generates.
Additionally, the FPI loan programme — loans to farmers secured by farmland — contributes growing interest income to the business, but it is precisely this segment that required higher loss provisions in 2026. The fact that management communicated this transparently is a positive sign — it would be more concerning if they had buried it.
Anyone researching FPI will inevitably come across 2018: an anonymous short-seller going by the name "Rota Fortunae" (later identified as David Quinton Matthews) published a report on Twitter and Seeking Alpha containing serious allegations — questionable related-party transactions, bankruptcy risk. The stock temporarily lost $115 million in market capitalisation, making the author's pre-purchased put options highly profitable.
FPI sued. Matthews admitted the falsity of central claims and paid FPI a multiple of his trading gains as damages. Sabrepoint Capital, which paid $100,000 to Matthews for the attack, was also implicated. The case is legally closed and well documented — the allegations at the time had no substantive basis.
What remains: a scar in the price history and — for informed investors — a reminder that cheap small-caps are vulnerable to coordinated attacks. FPI, with ~$422 million in market cap, is still a small-cap with correspondingly thinner liquidity.
The balance sheet is meaningfully more conservative than that of many REITs. As of FY2025:
| Metric | Value (FY2025) |
|---|---|
| Total assets | $719M |
| Long-term debt | $161M |
| Debt / total assets | 22.4% |
| Net Debt / EBITDA | 3.3x |
| Interest coverage | 2.4x |
| EV / EBITDA | 12.6x |
A 22% debt-to-assets ratio is very conservative for a real estate REIT. The Series A Preferred Units were fully redeemed in Q1 2026 — simplifying the capital structure and eliminating dilution risk. FPI is not leveraged up, unlike some mREITs or commercial mortgage REITs in the same REIT universe.
Agricultural land as a finite resource carries a structural long-term thesis. The United States needs food, and no new farmland is being created. FPI provides access to this asset class without having to operate a farm yourself. The NAV discount is real — the transaction track record demonstrates that farmland can be sold above book value. Management has proven through buybacks that it takes the undervaluation seriously. The 50% dividend increase in Q2 2026 is a positive signal.
The regular dividend yield of 3.7% is modest for a REIT. Investors looking for higher yield will find better elsewhere — at Realty Income (5–6%), at Omega Healthcare (5–6%), or at STAG Industrial. AFFO coverage of the regular dividend is marginally negative in 2026. The portfolio is intentionally shrinking, which also means lower recurring lease income. The small-cap status means thinner liquidity and higher volatility.
I hold FPI as a diversification building block for the hard-asset portion of my portfolio — not as a high-yield position. The thesis is the NAV discount plus special dividends, not the running yield. At 35 shares and −3.1% I am essentially at breakeven; I see no reason to add, but equally no reason to sell. If farmland prices recover and FPI can sell further acreage at a gain, the special dividend for 2026 (payable January 2027) becomes the catalyst. If guidance stays reduced and the loan programme continues to drag — then FPI remains a quiet, balance-sheet-backed hold without a near-term trigger.
For balance sheet analysis, fair-value models and real-time data on FPI, Realty Income and other REITs, I use InvestingPro. More capable than most free tools and entirely sufficient for retail investors.
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