MAA
Mid-America Apartment Communities, Inc.
$131.14
Real Estate Investment Trust
85%
P/FFO × Residential REIT Multiple
Strong
·
Conviction
Undervalued
Trading 44.5% below fair value
You pay
$131.14
Bear
$199.87
Fair
$236.27
Bull
$272.68
Bear
$199.87
+52.4%
$9.19 FFO × 19x
Fair
$236.27
+80.2%
$9.19 FFO × 22x
Bull
$272.68
+107.9%
$9.19 FFO × 26x
Key Value Driver
FFO/share ($9.19) × residential P/FFO multiple
Implied Market Multiple
14.3x
Summary
Our base-case estimate uses P/FFO × Residential REIT Multiple. We then blend that result with the average analyst price target of $141.62 from 37 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $236.27 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-based valuation: $443.38 (60% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $141.62 (from 37 analysts). Our estimate is 95% 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