FRT
Federal Realty Investment Trust
$105.46
Real Estate Investment Trust
85%
P/FFO × Retail REIT Multiple
Moderate
·
Conviction
Undervalued
Trading 26.4% below fair value
You pay
$105.46
Bear
$115.68
Fair
$143.34
Bull
$170.99
Bear
$115.68
+9.7%
$9.02 FFO × 16x
Fair
$143.34
+35.9%
$9.02 FFO × 20x
Bull
$170.99
+62.1%
$9.02 FFO × 23x
Adjust Assumptions
19.5x
$
Key Value Driver
FFO/share ($9.02) × retail P/FFO multiple
Implied Market Multiple
11.7x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (33 analysts)
$128.91
Divergence from AlphaVal
11%
Summary
At $9.02 FFO/share with a 20x retail REIT multiple, the base-case value is $143.34 per share. Dividend yield: 4.3%. DDM cross-check: $67.54.
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: $67.54 (53% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
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