VRE
Veris Residential, Inc.
$18.99
Real Estate Investment Trust
85%
P/FFO × Residential REIT Multiple
Moderate
·
Conviction
Undervalued
Trading 39.8% below fair value
You pay
$18.99
Bear
$26.58
Fair
$31.54
Bull
$36.51
Bear
$26.58
+40.0%
$1.72 FFO × 21x
Fair
$31.54
+66.1%
$1.72 FFO × 25x
Bull
$36.51
+92.3%
$1.72 FFO × 29x
Adjust Assumptions
24.7x
$
Key Value Driver
FFO/share ($1.72) × residential P/FFO multiple
Implied Market Multiple
11.0x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (12 analysts)
$14.00
Divergence from AlphaVal
125%
Summary
At $1.72 FFO/share with a 25x residential REIT multiple, the base-case value is $31.54 per share. Dividend yield: 1.7%. DDM cross-check: $5.96.
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.
The 1.7% yield is low for a real estate company — investors are paying up because they expect above-average growth.
Dividend-based valuation: $5.96 (81% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $14.00 (from 12 analysts). Our estimate is 125% 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