PCH
PotlatchDeltic Corporation
$41.73
Real Estate Investment Trust
85%
P/FFO × Specialty REIT Multiple
Strong
·
Conviction
Overvalued
Trading 91.8% above fair value
You pay
$41.73
Bear
$18.27
Fair
$21.76
Bull
$25.25
Bear
$18.27
-56.2%
$0.23 FFO × 22x
Fair
$21.76
-47.9%
$0.23 FFO × 27x
Bull
$25.25
-39.5%
$0.23 FFO × 32x
Key Value Driver
FFO/share ($0.23) × specialty P/FFO multiple
Implied Market Multiple
179.9x
Summary
Our base-case estimate uses P/FFO × Specialty REIT Multiple. We then blend that result with the average analyst price target of $51.00 from 13 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $21.76 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: $33.55 (132% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $51.00 (from 13 analysts). Our estimate is 72% 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