RYN
Rayonier Inc. REIT
$20.23
Real Estate Investment Trust
85%
P/FFO × Specialty REIT Multiple
Strong
·
Conviction
Undervalued
Trading 76.5% below fair value
You pay
$20.23
Bear
$70.36
Fair
$86.09
Bull
$101.83
Bear
$70.36
+247.9%
$3.81 FFO × 24x
Fair
$86.09
+325.7%
$3.81 FFO × 30x
Bull
$101.83
+403.5%
$3.81 FFO × 36x
Adjust Assumptions
30.1x
$
Key Value Driver
FFO/share ($3.81) × specialty P/FFO multiple
Implied Market Multiple
5.3x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (27 analysts)
$24.33
Divergence from AlphaVal
254%
Summary
At $3.81 FFO/share with a 30x specialty REIT multiple, the base-case value is $86.09 per share. Dividend yield: 5.2%. DDM cross-check: $19.61.
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 yield of 5.2% is unusually high — make sure the company generates enough cash to keep paying it.
Dividend-based valuation: $19.61 (77% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $24.33 (from 27 analysts). Our estimate is 254% 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