HR
Healthcare Realty Trust Incorporated
$18.90
Real Estate Investment Trust
85%
P/FFO × Healthcare REIT Multiple
Mild
·
Conviction
Fair Value
Trading 0.7% below fair value
You pay
$18.90
Bear
$14.80
Fair
$19.03
Bull
$23.26
Bear
$14.80
-21.7%
$0.91 FFO × 16x
Fair
$19.03
+0.7%
$0.91 FFO × 21x
Bull
$23.26
+23.1%
$0.91 FFO × 26x
Adjust Assumptions
21.0x
$
Key Value Driver
FFO/share ($0.91) × healthcare P/FFO multiple
Implied Market Multiple
20.9x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (30 analysts)
$22.14
Divergence from AlphaVal
14%
Summary
At $0.91 FFO/share with a 21x healthcare REIT multiple, the base-case value is $19.03 per share. Dividend yield: 5.1%. DDM cross-check: $17.89.
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 5.1% is unusually high — make sure the company generates enough cash to keep paying it.
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