CSR
Centerspace
$55.99
Real Estate Investment Trust
85%
P/FFO × Residential REIT Multiple
Strong
·
Conviction
Undervalued
Trading 57.4% below fair value
You pay
$55.99
Bear
$110.88
Fair
$131.56
Bull
$152.24
Bear
$110.88
+98.0%
$7.79 FFO × 21x
Fair
$131.56
+135.0%
$7.79 FFO × 25x
Bull
$152.24
+171.9%
$7.79 FFO × 29x
Key Value Driver
FFO/share ($7.79) × residential P/FFO multiple
Implied Market Multiple
7.2x
Summary
Our base-case estimate uses P/FFO × Residential REIT Multiple. We then blend that result with the average analyst price target of $64.25 from 11 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $131.56 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.
Dividend-based valuation: $45.92 (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 $64.25 (from 11 analysts). Our estimate is 131% 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