STAG
STAG Industrial, Inc.
$36.01
Real Estate Investment Trust
85%
P/FFO × Industrial REIT Multiple
Strong
·
Conviction
Undervalued
Trading 57.8% below fair value
You pay
$36.01
Bear
$69.82
Fair
$85.33
Bull
$100.85
Bear
$69.82
+93.9%
$2.98 FFO × 23x
Fair
$85.33
+137.0%
$2.98 FFO × 29x
Bull
$100.85
+180.1%
$2.98 FFO × 34x
Adjust Assumptions
28.6x
$
Key Value Driver
FFO/share ($2.98) × industrial P/FFO multiple
Implied Market Multiple
12.1x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (21 analysts)
$41.80
Divergence from AlphaVal
104%
Summary
At $2.98 FFO/share with a 29x industrial REIT multiple, the base-case value is $85.33 per share. Dividend yield: 3.6%.
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.
Wall Street's average price target is $41.80 (from 21 analysts). Our estimate is 104% 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