CCI
Crown Castle Inc.
$77.76
Real Estate Investment Trust
85%
P/FFO × Specialty REIT Multiple
Mild
·
Conviction
Fair Value
Trading 1.8% below fair value
You pay
$77.76
Bear
$64.50
Fair
$79.16
Bull
$93.82
Bear
$64.50
-17.0%
$2.60 FFO × 22x
Fair
$79.16
+1.8%
$2.60 FFO × 27x
Bull
$93.82
+20.7%
$2.60 FFO × 32x
Key Value Driver
FFO/share ($2.60) × specialty P/FFO multiple
Implied Market Multiple
30.0x
Summary
Our base-case estimate uses P/FFO × Specialty REIT Multiple. We then blend that result with the average analyst price target of $100.33 from 46 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $79.16 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 yield of 5.5% is unusually high — make sure the company generates enough cash to keep paying it.
Wall Street's average price target is $100.33 (from 46 analysts). Our estimate is 30% below 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