AMT
American Tower Corporation
$187.18
Real Estate Investment Trust
85%
P/FFO × Specialty REIT Multiple
Moderate
·
Conviction
Undervalued
Trading 32.0% below fair value
You pay
$187.18
Bear
$226.45
Fair
$275.32
Bull
$324.19
Bear
$226.45
+21.0%
$9.85 FFO × 29x
Fair
$275.32
+47.1%
$9.85 FFO × 35x
Bull
$324.19
+73.2%
$9.85 FFO × 42x
Key Value Driver
FFO/share ($9.85) × specialty P/FFO multiple
Implied Market Multiple
19.0x
Summary
Our base-case estimate uses P/FFO × Specialty REIT Multiple. We then blend that result with the average analyst price target of $211.00 from 50 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $275.32 per share.
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-based valuation: $226.22 (27% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $211.00 (from 50 analysts). Our estimate is 47% 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