ILPT
Industrial Logistics Properties Trust
$8.42
Real Estate Investment Trust
85%
P/FFO × Industrial REIT Multiple
Strong
·
Conviction
Undervalued
Trading 70.8% below fair value
You pay
$8.42
Bear
$23.63
Fair
$28.83
Bull
$34.03
Bear
$23.63
+180.7%
$1.48 FFO × 22x
Fair
$28.83
+242.4%
$1.48 FFO × 26x
Bull
$34.03
+304.2%
$1.48 FFO × 31x
Adjust Assumptions
26.4x
$
Key Value Driver
FFO/share ($1.48) × industrial P/FFO multiple
Implied Market Multiple
5.7x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (9 analysts)
$11.50
Divergence from AlphaVal
151%
Summary
At $1.48 FFO/share with a 26x industrial REIT multiple, the base-case value is $28.83 per share. Dividend yield: 3.0%. DDM cross-check: $4.66.
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: $4.66 (84% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $11.50 (from 9 analysts). Our estimate is 151% 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