BXMT
Blackstone Mortgage Trust, Inc.
$17.95
Real Estate Investment Trust
85%
P/FFO × Default REIT Multiple
Moderate
·
Conviction
Undervalued
Trading 33.2% below fair value
You pay
$17.95
Bear
$22.41
Fair
$26.87
Bull
$31.34
Bear
$22.41
+24.8%
$1.06 FFO × 18x
Fair
$26.87
+49.7%
$1.06 FFO × 22x
Bull
$31.34
+74.6%
$1.06 FFO × 26x
Key Value Driver
FFO/share ($1.06) × default P/FFO multiple
Implied Market Multiple
17.0x
Summary
At $1.06 FFO/share with a 22x default REIT multiple, the base-case value is $26.87 per share. Dividend yield: 10.5%. DDM cross-check: $35.04.
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 10.5% is unusually high — make sure the company generates enough cash to keep paying it.
Dividend-based valuation: $35.04 (30% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
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