SUNS
Sunrise Realty Trust, Inc.
$6.39
Real Estate Investment Trust
85%
P/FFO × Default REIT Multiple
Strong
·
Conviction
Undervalued
Trading 67.8% below fair value
You pay
$6.39
Bear
$16.35
Fair
$19.85
Bull
$23.36
Bear
$16.35
+155.9%
$0.90 FFO × 18x
Fair
$19.85
+210.7%
$0.90 FFO × 22x
Bull
$23.36
+265.5%
$0.90 FFO × 26x
Adjust Assumptions
22.1x
$
Key Value Driver
FFO/share ($0.90) × default P/FFO multiple
Implied Market Multiple
7.1x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (8 analysts)
$9.00
Divergence from AlphaVal
121%
Summary
At $0.90 FFO/share with a 22x default REIT multiple, the base-case value is $19.85 per share. Dividend yield: 18.8%. DDM cross-check: $22.36.
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 18.8% is unusually high — make sure the company generates enough cash to keep paying it.
Wall Street's average price target is $9.00 (from 8 analysts). Our estimate is 121% 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