ALEX
Alexander & Baldwin, Inc.
$20.84
Real Estate Investment Trust
85%
P/FFO × Retail REIT Multiple
Moderate
·
Conviction
Fair Value
Trading 24.4% below fair value
You pay
$20.84
Bear
$22.05
Fair
$27.56
Bull
$33.08
Bear
$22.05
+5.8%
$1.41 FFO × 16x
Fair
$27.56
+32.3%
$1.41 FFO × 20x
Bull
$33.08
+58.7%
$1.41 FFO × 23x
Adjust Assumptions
19.5x
$
Key Value Driver
FFO/share ($1.41) × retail P/FFO multiple
Implied Market Multiple
14.7x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (8 analysts)
$21.21
Divergence from AlphaVal
30%
Summary
At $1.41 FFO/share with a 20x retail REIT multiple, the base-case value is $27.56 per share. Dividend yield: 4.9%.
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.
Wall Street's average price target is $21.21 (from 8 analysts). Our estimate is 30% 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