FPI
Farmland Partners Inc.
$10.36
Real Estate Investment Trust
85%
P/FFO × Specialty REIT Multiple
Strong
·
Conviction
Undervalued
Trading 63.9% below fair value
You pay
$10.36
Bear
$23.41
Fair
$28.73
Bull
$34.05
Bear
$23.41
+126.0%
$0.82 FFO × 29x
Fair
$28.73
+177.3%
$0.82 FFO × 35x
Bull
$34.05
+228.7%
$0.82 FFO × 42x
Adjust Assumptions
35.1x
$
Key Value Driver
FFO/share ($0.82) × specialty P/FFO multiple
Implied Market Multiple
12.7x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (15 analysts)
$17.00
Divergence from AlphaVal
69%
Summary
At $0.82 FFO/share with a 35x specialty REIT multiple, the base-case value is $28.73 per share. Dividend yield: 3.2%. DDM cross-check: $24.70.
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.
Wall Street's average price target is $17.00 (from 15 analysts). Our estimate is 69% 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