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How to Value a REIT

By Matthew Frankel, CFP – Updated Nov 13, 2024 at 11:42AM

Key Points

  • Price-to-FFO is crucial for valuing REITs, since it adjusts net income to better reflect cash earnings.
  • Debt-to-EBITDA ratio helps compare REIT leverage; high differences can signal financial risk.
  • Assess REITs' cyclical nature and lease terms to gauge economic sensitivity and investment stability.
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