AHH
AH Realty Trust, Inc.
$6.76
Real Estate Investment Trust
85%
P/FFO × Diversified REIT Multiple
Strong
·
Conviction
Undervalued
Trading 61.5% below fair value
You pay
$6.76
Bear
$14.54
Fair
$17.55
Bull
$20.57
Bear
$14.54
+115.0%
$1.21 FFO × 14x
Fair
$17.55
+159.6%
$1.21 FFO × 17x
Bull
$20.57
+204.2%
$1.21 FFO × 20x
Adjust Assumptions
17.0x
$
Key Value Driver
FFO/share ($1.21) × diversified P/FFO multiple
Implied Market Multiple
5.6x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (14 analysts)
$8.25
Divergence from AlphaVal
113%
Summary
At $1.21 FFO/share with a 17x diversified REIT multiple, the base-case value is $17.55 per share. Dividend yield: 8.3%. DDM cross-check: $10.44.
Warnings
Standard profit figures are misleading for real estate companies — large non-cash accounting charges make profits look artificially low. Dividend yield and funds from operations are better measures.
Dividend yield of 8.3% is unusually high — make sure the company generates enough cash to keep paying it.
Dividend-based valuation: $10.44 (41% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $8.25 (from 14 analysts). Our estimate is 113% above the consensus -- consider that gap carefully.
Key Risks
- P/E and EV/EBITDA are structurally wrong for REITs — use P/FFO and NAV
- Interest rate sensitivity: REIT multiples compress when rates rise
- FFO approximation (NI + D&A) may include gains on property sales — verify