VICI
VICI Properties Inc.
$28.50
Real Estate Investment Trust
85%
P/FFO × Specialty REIT Multiple
Strong
·
Conviction
Undervalued
Trading 58.5% below fair value
You pay
$28.50
Bear
$56.53
Fair
$68.74
Bull
$80.95
Bear
$56.53
+98.4%
$2.58 FFO × 29x
Fair
$68.74
+141.2%
$2.58 FFO × 35x
Bull
$80.95
+184.0%
$2.58 FFO × 42x
Key Value Driver
FFO/share ($2.58) × specialty P/FFO multiple
Implied Market Multiple
11.0x
Summary
Our base-case estimate uses P/FFO × Specialty REIT Multiple. We then blend that result with the average analyst price target of $32.17 from 26 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $68.74 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 6.3% is unusually high — make sure the company generates enough cash to keep paying it.
Dividend-based valuation: $58.38 (28% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $32.17 (from 26 analysts). Our estimate is 152% 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