GNL
Global Net Lease, Inc.
$7.12
Real Estate Investment Trust
85%
P/FFO × Diversified REIT Multiple
Strong
·
Conviction
Overvalued
Trading 57.0% above fair value
You pay
$7.12
Bear
$3.85
Fair
$4.54
Bull
$5.22
Bear
$3.85
-46.0%
$0.02 FFO × 15x
Fair
$4.54
-36.3%
$0.02 FFO × 18x
Bull
$5.22
-26.6%
$0.02 FFO × 21x
Adjust Assumptions
18.1x
$
Key Value Driver
FFO/share ($0.02) × diversified P/FFO multiple
Implied Market Multiple
314.2x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (16 analysts)
$10.40
Divergence from AlphaVal
56%
Summary
At $0.02 FFO/share with a 18x diversified REIT multiple, the base-case value is $4.54 per share. Dividend yield: 10.7%. DDM cross-check: $14.16.
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 10.7% is unusually high — make sure the company generates enough cash to keep paying it.
Dividend-based valuation: $14.16 (212% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $10.40 (from 16 analysts). Our estimate is 56% below 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