CSR
Centerspace
$57.45
Real Estate Investment Trust
85%
P/FFO × Residential REIT Multiple
Strong
·
Conviction
Undervalued
Trading 61.6% below fair value
You pay
$57.45
Bear
$126.20
Fair
$149.73
Bull
$173.27
Bear
$126.20
+119.7%
$7.87 FFO × 21x
Fair
$149.73
+160.6%
$7.87 FFO × 25x
Bull
$173.27
+201.6%
$7.87 FFO × 29x
Adjust Assumptions
24.7x
$
Key Value Driver
FFO/share ($7.87) × residential P/FFO multiple
Implied Market Multiple
7.3x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (12 analysts)
$63.50
Divergence from AlphaVal
136%
Summary
At $7.87 FFO/share with a 25x residential REIT multiple, the base-case value is $149.73 per share. Dividend yield: 5.4%. DDM cross-check: $45.42.
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 5.4% is unusually high — make sure the company generates enough cash to keep paying it.
Dividend-based valuation: $45.42 (70% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $63.50 (from 12 analysts). Our estimate is 136% 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