SPG
Simon Property Group, Inc.
$235.61
Real Estate Investment Trust
85%
P/FFO × Retail REIT Multiple
Moderate
·
Conviction
Undervalued
Trading 34.1% below fair value
You pay
$235.61
Bear
$292.88
Fair
$357.53
Bull
$422.17
Bear
$292.88
+24.3%
$18.80 FFO × 16x
Fair
$357.53
+51.7%
$18.80 FFO × 20x
Bull
$422.17
+79.2%
$18.80 FFO × 23x
Key Value Driver
FFO/share ($18.80) × retail P/FFO multiple
Implied Market Multiple
12.5x
Summary
Our base-case estimate uses P/FFO × Retail REIT Multiple. We then blend that result with the average analyst price target of $219.67 from 37 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $357.53 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: $533.14 (28% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $219.67 (from 37 analysts). Our estimate is 90% 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