Farmland Partners (FPI) Stock: Dividend vs AFFO and Loan Risk

The dividend against AFFO, quarter by quarter

FPI reports AFFO, adjusted funds from operations, as its measure of earnings power. It starts from net income, removes gains on farm sales, depreciation and impairments to get FFO, then adds stock compensation and subtracts distributions on the preferred units. It does not add back the credit-loss provision, which matters this year (see below).

Sources: the earnings releases furnished on Forms 8-K for Q3 2025, the full year 2025, Q1 2026 and Q2 2026. The Q4 2025 row is our subtraction of nine-month AFFO ($6.468 million, $0.14) from full-year AFFO ($17.872 million, $0.39). Per-share ratios use the rounded per-share figures the company reports, so they are approximate.

Two things stand out. First, FPI's earnings arrive late in the year. Four quarters show $2.3 million, $1.3 million, $2.9 million and an implied $11.4 million, and the company's own 2026 guidance only works if the second half repeats part of that. Second, the dividend was raised 50% into a first half where AFFO per share was flat to up only a cent. The company said so directly: “raised cash dividends by 50% to an annualized dividend of $0.36 per share, or $0.09 per quarter.” In the same release it cut its guidance, and its CEO's explanation was “We reduced our guidance for the year due to non-cash allowances for potential loan losses under the FPI loan program.” In July it raised the low end to $0.31 from $0.30 and kept the top at $0.35.

The specials explain the history. FPI paid $1.15 per share on January 8, 2025 and $0.21 on January 12, 2024, then declared $0.20 in December 2025 for payment in January 2026 ($8.8 million of the $11.4 million accrued at December 31, 2025). The 10-K ties the $0.20 to “asset appreciation”, meaning gains from selling farms, not to AFFO. Because those gains were large in 2024 and 2025, the specials are not a pattern to project forward. At the June 30, 2026 pace of two small sales and $3.3 million of gains, there is less to distribute that way.

A cash-flow check points the same way. Operating cash flow was $5.182 million in the first six months of 2026. Dividends on common stock paid were $15.130 million, of which $8.8 million was the accrued special, leaving about $6.3 million of regular dividends paid (our arithmetic). The gap was filled by farm sales and borrowing.

Why the second half carries the year

H1 2026 AFFO of $0.09 per share is 29% to 26% of the 2026 guidance range (our arithmetic). Several items in the Q2 numbers show why the year is not a straight line.

Net income is not a guide here. In Q2 2026 it included a $3.527 million gain on selling one property; in Q2 2025 it included $24.228 million of gains and a $16.821 million impairment. FFO removes both, which is why FFO fell while net income swung. For the first half, rental income was $12.002 million against $12.994 million, a 7.6% drop (our arithmetic), because FPI sold 60 properties in 2025 for $90.2 million and a gain of $34.9 million, and two more in 2026. NOI rose 4.7% in the half on a smaller base.

The provision is the other item. FPI booked $2.601 million of credit-loss provisions in the first half of 2026, against $69 thousand a year earlier. That is 69% of first-half AFFO of $3.769 million (our arithmetic). Without it, first-half AFFO would have been about $6.4 million, or $0.14 per share (our arithmetic, not a company figure). The reserve build is the cost of the loan book discussed next.

The loan book: one borrower at 71%

Besides owning farms, FPI lends to farmers and landowners under what it calls the FPI Loan Program, and it also holds sale-leasebacks accounted for as financing arrangements. At June 30, 2026 the program had $56.537 million of principal (December 31, 2025: $44.581 million) and financing receivables were $25.038 million (December 31, 2025: $40.225 million). After the allowance, loans and financing receivables were $76.388 million, about 11% of total assets of $699.8 million (our arithmetic).

The exposure did not shrink. A $15.130 million sale-leaseback converted into a note when the original term ended in April 2026, and the borrower's loans grew by $14.3 million while its financing receivables fell by $15.2 million (our arithmetic). The 10-Q says that during the first half “accrued interest on four loans and rent related to one financing receivable from a single borrower became past due,” and that “the loan agreements were amended to convert the outstanding amounts into principal totaling approximately $ 1.5 million.” A footnote adds that past-due interest and rent through April 30, 2026 were converted into principal and that the lease on one property was extended to December 31, 2026.

The notes carry the maturity. Three monthly-pay notes of $20.269 million, $5.582 million and $4.000 million, plus a $17.350 million note, all mature on 12/31/2026. They add up to $47.201 million, the same as the $47.2 million single-borrower loan balance (our sum). The company did not state this match in one sentence, so treat it as our reading of the loan table and the borrower note. The 10-Q also states a risk about collateral: “Non-agricultural collateral may carry a different risk profile, which can cause values to change over the course of a loan.”

The allowance is the company's estimate of loss. It rose to $4.759 million from $2.158 million, 5.8% of the $81.575 million of loan principal plus financing receivables (our arithmetic). There were no charge-offs in either half-year. What the filings do not show is how the borrower is repaying: the 10-Q gives balances and amendments, not payment dates beyond maturity. The Q3 10-Q is the first look at whether the December 31 maturities are on track.

Debt, preferred units and the buyback that stopped

FPI had two big financing moves in a year. In 2025 it cut debt from $204.6 million to $161.6 million and repurchased 3,411,581 shares at a weighted average of $11.07. In 2026 it did the reverse: on February 6, 2026 it redeemed the last 68,000 Series A preferred units for $68.0 million plus accrued distributions, $68.2 million in all, paid with debt. Debt was $232.8 million at March 31, 2026 and $224.8 million at June 30, 2026, after $8.0 million of line-of-credit repayments following the first quarter.

Of that debt, $68.1 million, or 30.3%, is variable rate. The new Farmer Mac facility has $63.2 million drawn at 4.92% (SOFR plus 1.30%) and matures December 2028; MetLife term loans account for $156.7 million. FPI also has $50.0 million undrawn on a MetLife revolver and $46.0 million undrawn on the Rutledge facility. There were no share repurchases in the first half of 2026, and $17.9 million of authority remains. The company says $26.2 million of debt matures within 12 months of June 30, 2026; that equals the 2027 row above, which is four MetLife loans due between January and June 2027 (our reading of the loan table).

What is in the portfolio

FPI owned about 70,100 acres in 11 states at June 30, 2026, down from 71,610 acres in the December 31, 2025 lease table. By region: Corn Belt 36,297 acres (51.8%, our arithmetic), Southeast 10,177, West Coast 9,774 (13.9%), High Plains 7,373 and Delta and South 6,459. By value about 60% is row crops such as corn, soybeans, wheat, rice and cotton, and about 40% is specialty crops such as almonds, pistachios and citrus. The West Coast is where the impairments have landed: $16.821 million in Q2 2025 and $0.751 million in Q2 2026.

Farm leases run one to three years, so 59.1% of acres and 72.1% of annual fixed rent of $19.867 million (our sums) come up for renewal by the end of 2027. The 10-Q says the vacancy rate for quality US farmland is near zero and that it does not see re-leasing as a significant risk. At December 31, 2025 annual fixed rents were $19.140 million on 71,610 acres, so fixed rent rose while acres fell (our arithmetic).

What a holder can do with this

The published price is only one input. At $10.35 on October 16, 2026 (Yahoo Finance close, market data, not an SEC filing), FPI traded at 0.98 times book value of about $10.54 per share (our arithmetic: $463.112 million of equity less $3.108 million of non-controlling interests, over 43.629 million shares). A 3.5% yield on a dividend that guidance says is not covered by AFFO is a different proposition from the same yield on a fully covered one. Compare it with how the same farmland reads in our farmland investing guide, which sets FPI beside Gladstone Land, USDA land values and the private platforms.

A listed REIT and a non-traded vehicle differ in how you get out: FPI trades every day at whatever price the market gives, a non-traded REIT or a platform deal like those in our FarmTogether review and AcreTrader review does not. For the general case, see non-traded REIT versus publicly traded REIT and why a listing can price below the private NAV.

Three dated things to watch: the Q3 results and 10-Q (the company filed its Q3 2025 10-Q on October 30, 2025, so late October 2026 is likely, our inference; nothing is filed for Q3 2026 as of October 19), the status of the $47.2 million of notes due December 31, 2026, and whether the next dividend declaration, normally in late October, keeps the $0.09. This is analysis of public documents, not investment, legal or tax advice.

Frequently asked questions

Sources, read and saved October 19, 2026: Farmland Partners Inc. (CIK 1591670) Form 10-K for 2025 (0001104659-26-017533); Forms 10-Q for March 31, 2026 (0001104659-26-052874), June 30, 2026 (0001104659-26-088677) and September 30, 2025 (0001104659-25-104363); earnings releases furnished as Exhibit 99.1 to Forms 8-K filed October 29, 2025 (0001104659-25-103713), February 18, 2026 (0001104659-26-017035), April 29, 2026 (0001104659-26-051481) and July 29, 2026 (0001104659-26-088140); the EDGAR filing list for the CIK; and Yahoo Finance daily closes for FPI through October 16, 2026 (market data, not an SEC filing). Sums, ratios and percentages are our arithmetic. We have no relationship with any company named and earn nothing if you invest. This is analysis of public documents, not investment, legal or tax advice.