CSR
Centerspace
$52.90
Real Estate Investment Trust
85%
P/FFO × Residential REIT Multiple
Strong
·
Conviction
Undervalued
Trading 64.3% below fair value
You pay
$52.90
Bear
$124.94
Fair
$148.24
Bull
$171.53
Bear
$124.94
+136.2%
$7.79 FFO × 21x
Fair
$148.24
+180.2%
$7.79 FFO × 25x
Bull
$171.53
+224.3%
$7.79 FFO × 29x
Adjust Assumptions
24.7x
$
Key Value Driver
FFO/share ($7.79) × residential P/FFO multiple
Implied Market Multiple
6.8x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (11 analysts)
$62.25
Divergence from AlphaVal
138%
Summary
At $7.79 FFO/share with a 25x residential REIT multiple, the base-case value is $148.24 per share. Dividend yield: 5.8%. 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 5.8% is unusually high — make sure the company generates enough cash to keep paying it.
Dividend-based valuation: $45.42 (69% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $62.25 (from 11 analysts). Our estimate is 138% 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