TRNO
Terreno Realty Corporation
$66.05
Real Estate Investment Trust
85%
P/FFO × Industrial REIT Multiple
Strong
·
Conviction
Undervalued
Trading 44.8% below fair value
You pay
$66.05
Bear
$97.99
Fair
$119.76
Bull
$141.54
Bear
$97.99
+48.4%
$4.93 FFO × 23x
Fair
$119.76
+81.3%
$4.93 FFO × 29x
Bull
$141.54
+114.3%
$4.93 FFO × 34x
Key Value Driver
FFO/share ($4.93) × industrial P/FFO multiple
Implied Market Multiple
13.4x
Summary
Our base-case estimate uses P/FFO × Industrial REIT Multiple. We then blend that result with the average analyst price target of $69.90 from 32 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $119.76 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.
Wall Street's average price target is $69.90 (from 32 analysts). Our estimate is 102% 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