MAC
The Macerich Company
$26.51
Real Estate Investment Trust
85%
P/FFO × Retail REIT Multiple
Strong
·
Conviction
Overvalued
Trading 84.9% above fair value
You pay
$26.51
Bear
$11.76
Fair
$14.34
Bull
$16.92
Bear
$11.76
-55.7%
$0.57 FFO × 12x
Fair
$14.34
-45.9%
$0.57 FFO × 15x
Bull
$16.92
-36.2%
$0.57 FFO × 18x
Key Value Driver
FFO/share ($0.57) × retail P/FFO multiple
Implied Market Multiple
46.8x
Summary
Our base-case estimate uses P/FFO × Retail REIT Multiple. We then blend that result with the average analyst price target of $25.00 from 35 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $14.34 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: $12.76 (31% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $25.00 (from 35 analysts). Our estimate is 61% 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