LAND
Gladstone Land Corporation
$8.64
Real Estate Investment Trust
85%
P/FFO × Specialty REIT Multiple
Strong
·
Conviction
Undervalued
Trading 63.2% below fair value
You pay
$8.64
Bear
$19.15
Fair
$23.46
Bull
$27.76
Bear
$19.15
+121.8%
$1.11 FFO × 23x
Fair
$23.46
+171.6%
$1.11 FFO × 29x
Bull
$27.76
+221.5%
$1.11 FFO × 34x
Adjust Assumptions
28.7x
$
Key Value Driver
FFO/share ($1.11) × specialty P/FFO multiple
Implied Market Multiple
7.7x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (11 analysts)
$13.33
Divergence from AlphaVal
76%
Summary
At $1.11 FFO/share with a 29x specialty REIT multiple, the base-case value is $23.46 per share. Dividend yield: 2.2%. DDM cross-check: $3.48.
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: $3.48 (85% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $13.33 (from 11 analysts). Our estimate is 76% 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