ELS
Equity LifeStyle Properties, Inc.
$64.90
Real Estate Investment Trust
85%
P/FFO × Residential REIT Multiple
Moderate
·
Conviction
Fair Value
Trading 23.6% below fair value
You pay
$64.90
Bear
$71.84
Fair
$84.91
Bull
$97.99
Bear
$71.84
+10.7%
$3.07 FFO × 18x
Fair
$84.91
+30.8%
$3.07 FFO × 21x
Bull
$97.99
+51.0%
$3.07 FFO × 25x
Key Value Driver
FFO/share ($3.07) × residential P/FFO multiple
Implied Market Multiple
21.1x
Summary
Our base-case estimate uses P/FFO × Residential REIT Multiple. We then blend that result with the average analyst price target of $70.50 from 21 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $84.91 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-based valuation: $147.01 (64% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $70.50 (from 21 analysts). Our estimate is 27% 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