DCF Studio

    ARE · NYQ · Real Estate

    Alexandria Real Estate Equities, Inc.

    Also onConsensus Drift

    Implied value per share

    USD -29.20

    Market price

    USD 42.57

    Implied upside

    -168.6%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    AdjustedReported capital expenditure averages just 0.00% of revenue, which is too low to be the company's real investment - property trusts and similar structures invest through lines that are not reported as capex. Capex has been set to 40.66% of revenue so the forecast is not handed free growth. Override it if the reported figure is right.

    Value Per Share

    Perpetuity growth
    USD -29.20-168.6%
    Exit multiple
    USD -4.35-110.2%
    Market price
    USD 42.57

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0m248m496mFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 2.6bnUSD 2.6bnUSD 2.5bnUSD 2.5bnUSD 2.4bnUSD 2.4bnUSD 2.4bnUSD 2.5bnUSD 2.5bnUSD 2.6bn-0.3%
    EBITUSD 609.8mUSD 590.6mUSD 576.3mUSD 566.3mUSD 560.5mUSD 558.7mUSD 560.8mUSD 566.9mUSD 577.1mUSD 591.5m-0.3%
    NOPATUSD 609.8mUSD 590.6mUSD 576.3mUSD 566.3mUSD 560.5mUSD 558.7mUSD 560.8mUSD 566.9mUSD 577.1mUSD 591.5m-0.3%
    Add depreciation & amortisationUSD 1.0bnUSD 976.4mUSD 952.6mUSD 936.1mUSD 926.5mUSD 923.5mUSD 927.1mUSD 937.2mUSD 954.0mUSD 977.8m-0.3%
    Less capital expenditureUSD -1.1bnUSD -1.1bnUSD -1.0bnUSD -1.0bnUSD -1.0bnUSD -1.1bnUSD -1.1bnUSD -1.1bnUSD -1.1bnUSD -1.2bn+1.0%
    Capex, % of revenue40.7%41.2%41.8%42.4%42.9%43.5%44.1%44.6%45.2%45.8%-
    Less increase in working capitalUSD -51.5mUSD -14.3mUSD -10.7mUSD -7.5mUSD -4.3mUSD -1.3mUSD 1.6mUSD 4.6mUSD 7.6mUSD 10.8m-
    Free cashflow to firmUSD 490.4mUSD 496.1mUSD 473.1mUSD 454.1mUSD 438.7mUSD 426.5mUSD 417.3mUSD 410.9mUSD 407.0mUSD 405.7m-2.1%
    Discount factor0.96440.89690.83420.77590.72160.67110.62420.58050.53990.5022-
    Present valueUSD 472.9mUSD 445.0mUSD 394.6mUSD 352.3mUSD 316.5mUSD 286.2mUSD 260.5mUSD 238.5mUSD 219.8mUSD 203.7m-
    Present Value Of The ForecastUSD 3.2bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.128Reported 1.191, pulled toward 1.0 (Blume)
    Cost of equity9.67%Risk-free + beta x equity risk premium
    Cost of debt6.27%Risk-free + 138bp, the spread for a BB+ rating at 2.4x interest cover. Book interest / average debt was lower, at 1.8%.
    Market capitalisationUSD 7.4bn36.7% of capital
    Total debtUSD 12.8bn63.3% of capital, book value as a proxy
    Tax rate0.0%Effective, capped at statutory
    WACC7.52%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD -29.20

    56% of EV

    Forecast FCFF, final year
    USD 405.7m
    Capex at depreciation, working capital in reinvestment
    USD 591.5m
    Less reinvestment at g/ROIC (33.2% of NOPAT)
    USD -196.7m
    Capitalised
    USD 394.9m
    ROIC (WACC floor)
    7.5%
    Terminal value, undiscounted
    USD 8.1bn
    Terminal value, discounted
    USD 4.0bn
    Enterprise value
    USD 7.2bn
    Less net debt
    USD 12.2bn
    Equity value
    USD -5.0bn

    Exit at 10.5x EBITDA

    Value per shareUSD -4.35

    72% of EV

    Terminal value, undiscounted
    USD 16.5bn
    Terminal value, discounted
    USD 8.3bn
    Enterprise value
    USD 11.5bn
    Less net debt
    USD 12.2bn
    Equity value
    USD -740.9m

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    5.52%-12.36-13.24-14.11-14.98-15.85
    6.52%-21.42-22.12-22.81-23.51-24.21
    7.52%-28.06-28.63-29.20-29.77-30.35
    8.52%-33.13-33.61-34.09-34.56-35.04
    9.52%-37.13-37.54-37.94-38.35-38.75

    Outlined: this model. Green text: above today's price of 42.57. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year4.6%-1.4%9.9%
    EBIT margin25.2%23.0%60.3%
    Discount rate-7.5%2.8%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.