VICI
VICI Properties Inc.
$26.79
Real Estate Investment Trust
85%
P/FFO × Diversified REIT Multiple
Strong
·
Conviction
Undervalued
Trading 47.1% below fair value
You pay
$26.79
Bear
$41.72
Fair
$50.66
Bull
$59.60
Bear
$41.72
+55.7%
$2.60 FFO × 18x
Fair
$50.66
+89.1%
$2.60 FFO × 22x
Bull
$59.60
+122.5%
$2.60 FFO × 26x
Key Value Driver
FFO/share ($2.60) × diversified P/FFO multiple
Implied Market Multiple
10.3x
Summary
Our base-case estimate uses P/FFO × Diversified REIT Multiple. We then blend that result with the average analyst price target of $30.29 from 26 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $50.66 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 yield of 6.7% is unusually high — make sure the company generates enough cash to keep paying it.
Wall Street's average price target is $30.29 (from 26 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