GLPI
Gaming and Leisure Properties, Inc.
$43.54
Real Estate Investment Trust
85%
P/FFO × Specialty REIT Multiple
Strong
·
Conviction
Undervalued
Trading 65.6% below fair value
You pay
$43.54
Bear
$105.01
Fair
$126.41
Bull
$147.82
Bear
$105.01
+141.2%
$3.91 FFO × 25x
Fair
$126.41
+190.3%
$3.91 FFO × 30x
Bull
$147.82
+239.5%
$3.91 FFO × 36x
Key Value Driver
FFO/share ($3.91) × specialty P/FFO multiple
Implied Market Multiple
11.1x
Summary
Our base-case estimate uses P/FFO × Specialty REIT Multiple. We then blend that result with the average analyst price target of $52.00 from 27 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $126.41 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 7.3% is unusually high — make sure the company generates enough cash to keep paying it.
Dividend-based valuation: $226.37 (50% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $52.00 (from 27 analysts). Our estimate is 191% 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