Innovative Industrial Properties (Innovative Industrial Properties) Intrinsic Value: DCF (Dividends Based) : $160.31 (As of May. 24, 2024)

View and export this data going back to 2016. Start your Free Trial

What is Innovative Industrial Properties Intrinsic Value: DCF (Dividends Based)?

As of today (2024-05-24), Innovative Industrial Properties's intrinsic value calculated from the Discounted Dividend model is $160.31.

Note: Discounted Dividend model is only suitable for companies who have a consistant distribution history. If the company's dividends does not remain steady over a long period, results may not be accurate due to the low consistency. The model is also only suitable for predictable companies (Business Predictability Rank higher than 1-Star) with dividend payments. If the company's Predictability Rank is 1-Star or Not Rated, or if the company does not pay dividend, the data will not be stored into our database.

Innovative Industrial Properties's Predictability Rank is Not Rated. Thus, this page is only used for demonstration purposes and the DCF related results in the screener and portfolio will appear as zero.

Margin of Safety % (DCF Dividends Based) using Discounted Dividend Model for Innovative Industrial Properties is 31.88%.

The historical rank and industry rank for Innovative Industrial Properties's Intrinsic Value: DCF (Dividends Based) or its related term are showing as below:

IIPR's Price-to-DCF (Dividends Based) is not ranked ^*
in the REITs industry.
Industry Median: 1.98
* Ranked among companies with meaningful Price-to-DCF (Dividends Based) only.

Innovative Industrial Properties Intrinsic Value: DCF (Dividends Based) Historical Data

The historical data trend for Innovative Industrial Properties's Intrinsic Value: DCF (Dividends Based) can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Innovative Industrial Properties Intrinsic Value: DCF (Dividends Based) Chart

Innovative Industrial Properties Annual Data

Trend

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Intrinsic Value: DCF (Dividends Based)

Get a 7-Day Free Trial

Innovative Industrial Properties Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
Intrinsic Value: DCF (Dividends Based)	Get a 7-Day Free Trial															-	-	-	-	-

Competitive Comparison of Innovative Industrial Properties's Intrinsic Value: DCF (Dividends Based)

For the REIT - Industrial subindustry, Innovative Industrial Properties's Price-to-DCF (Dividends Based), along with its competitors' market caps and Price-to-DCF (Dividends Based) data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Innovative Industrial Properties's Price-to-DCF (Dividends Based) Distribution in the REITs Industry

For the REITs industry and Real Estate sector, Innovative Industrial Properties's Price-to-DCF (Dividends Based) distribution charts can be found below:

* The bar in red indicates where Innovative Industrial Properties's Price-to-DCF (Dividends Based) falls into.

Innovative Industrial Properties Intrinsic Value: DCF (Dividends Based) Calculation

This is the intrinsic value calculated from the Discounted Dividend Model with default parameters. The calculation method is the same as Discounted Cash Flow model except adjusted dividend are used in the calculation instead of free cash flow. This is the default method of calculation with GuruFocus DCF calculator.

Usually a two-stage model is used in calculating the intrinsic value with discounted cash flow model. The first stage is called growth stage; the second is called the terminal stage. In the growth stage the company grows at a faster rate. Because it cannot grow at that rate forever, a lower rate is used for the terminal stage.

GuruFocus DDM calculator is a two-stage model. The default values are defined as:

1. Discount Rate: d = 11%
A reasonable discount rate assumption should be at least the long term average return of the stock market, which can be estimated from risk free rate plus risk premium of stock market. GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate and rounded up to the nearest integer. It is updated daily. The current risk-free rate is 4.47%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default. Then we added a risk premium of 6% to get the estimated discount rate. Some investors use their expected rate of return, which is also reasonable. A typical discount rate can be anywhere between 6% - 20%.

2. Dividend Growth Rate in the growth stage: g1 = 20%
The Growth Rate in the growth stage is initially set as the default 10-Year Dividend Growth Rate. In cases where the 10-year growth rate is unavailable, it defaults to using the 5-Year Dividend Growth Rate. If both the 10-year and 5-year growth rates are unavailable, the system defaults to the 3-Year Dividend Growth Rate.
However, it's important to note that there is a growth rate range. If the calculated growth rate exceeds 20%, it will be capped at 20%. Conversely, if the calculated growth rate falls below 5%, it will be adjusted to 5% to maintain a reasonable range.
=> Innovative Industrial Properties's average Dividend Growth Rate in the past 5 years was 40.80%, which is no less than 20%. GuruFocus defaults => Growth Rate: 20%

3. Years of Growth Stage: y1 = 10

4. Terminal Growth Rate: g2 = 4%

5. Dividends per Share: adjusted dividends per share = $5.13.
GuruFocus uses adjusted dividends per share by default to ensure that the valuation reflects the total value of the company, as the actual dividend is only a portion of the total value.

All of the default settings can be changed in the DCF calculator and the results are calculated automatically.

Innovative Industrial Properties's Intrinsic Value: DCF (Dividends Based) for today is calculated as:

Intrinsic Value: DCF (Dividends Based)	=	Dividends per Share	*	{[(1+g1)/(1+d)	+	(1+g1)^2/(1+d)^2	+	...	+	(1+g1)^10/(1+d)^10]
	+	(1+g1)^10/(1+d)^10	*	[(1+g2)/(1+d)	+	(1+g2)^2/(1+d)^2	+	...	+	(1+g2)^10/(1+d)^10]}

set x = (1+g1)/(1+d) = (1+0.2)/(1+0.11) = 1.0810810810811
and y = (1+g2)/(1+d) = (1+0.04)/(1+0.11) = 0.93693693693694

Intrinsic Value: DCF (Dividends Based)

Dividends per Share

{[x

x^2

...

x^10]

x^10

y^2

...

y^10]}

Dividends per Share

(1-x^10)

(1-x)

x^10

(1-y^10)

(1-y)]

5.13

31.2501

160.31

Margin of Safety % (DCF Dividends Based)	=	(Intrinsic Value: DCF (Dividends Based)	-	Current Price)	/	Intrinsic Value: DCF (Dividends Based)
	=	(160.31	-	109.20)	/	160.31
	=	31.88 %

Innovative Industrial Properties (NYSE:IIPR) Intrinsic Value: DCF (Dividends Based) Explanation

Unlike valuation methods such as Net Current Asset Value, Tangible Book per Share, Graham Number, Median PS Value etc, discounted Dividends model evaluates the companies based on their power of future dividend distribution instead of their assets.

Be Aware

What you need to know about Discounted Dividends model:

1. The Discounted Dividends model evaluates a company based on its future dividends distribution power
2. Dividend growth is taken into account; therefore a company with a higher dividend growth rate is worth more if everything else is the same.
3. Since we are projecting future growth, it is assumed that the company will grow at the same rate as it did during the past 10 years. Therefore this model works better for the companies with consistently steady dividends distributed.
4. The Discounted Dividends model works poorly for inconsistent dividends distributor like high growth companies.
5. Your expected return from the investment is a reasonable discount rate assumption.
6. A larger margin of safety should be required for companies with less dividends distributed.

You can screen for stocks that trade below their Intrinsic Value: DCF (FCF Based) and Intrinsic Value: DCF (Earnings Based) and Intrinsic Value: DCF (Dividends Based) with the GuruFocus All-in-One Screener. Companies with a high Predictability Rank that trade at a discount to their Intrinsic Value: DCF (FCF Based) and Intrinsic Value: DCF (Earnings Based) can be found in the screen of Undervalued Predictable Companies.

Innovative Industrial Properties Intrinsic Value: DCF (Dividends Based) Related Terms

Thank you for viewing the detailed overview of Innovative Industrial Properties's Intrinsic Value: DCF (Dividends Based) provided by GuruFocus.com. Please click on the following links to see related term pages.

Innovative Industrial Properties (Innovative Industrial Properties) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » REITs » Innovative Industrial Properties Inc (NYSE:IIPR) » Definitions » Intrinsic Value: DCF (Dividends Based)

Comparable Companies

Traded in Other Exchanges

IIPRpA.PFD:USA 1IK:Germany 1IK:Germany

Address

1389 Center Drive, Suite 220, Park City, UT, USA, 84098

Website

https://www.innovativeindustrialproperties.com

Innovative Industrial Properties Inc is a real estate investment trust engaged in the acquisition, ownership, and management of specialized industrial properties leased to state-licensed operators for their regulated medical-use cannabis facilities. It conducts its business through a traditional umbrella partnership real estate investment trust, or UPREIT structure, in which properties are owned by Operating Partnership, directly or through subsidiaries. Its property portfolio is spread across the United States.

Executives

David Stecher	director	C/O INNOVATIVE INDUSTRIAL PROPERTIES INC, 17190 BERNARDO CENTER DRIVE, SAN DIEGO CA 92128
David Jon Smith	officer: CFO AND TREASURER	C/O FIG LLC, 1345 AVENUE OF THE AMERICAS, NEW YORK NY 10105
Alan D Gold	director, officer: Executive Chairman	17140 BERNARDO CENTER DRIVE, SUITE 195, SAN DIEGO CA 92128
Scott Shoemaker	director	C/O INNOVATIVE INDUSTRIAL PROPERTIES INC, 17190 BERNARDO CENTER DRIVE, SAN DIEGO CA 92128
Brian J. Wolfe	officer: VP, GEN. COUNSEL AND SECRETARY	C/O INNOVATIVE INDUSTRIAL PROPERTIES INC, 17190 BERNARDO CENTER DRIVE, SAN DIEGO CA 92128
Paul E. Smithers	director, officer: PRESIDENT, CEO AND DIRECTOR	C/O INNOVATIVE INDUSTRIAL PROPERTIES INC, 17190 BERNARDO CENTER DRIVE, SAN DIEGO CA 92128
Catherine Hastings	officer: CFO AND TREASURER	C/O INNOVATIVE INDUSTRIAL PROPERTIES INC, 17190 BERNARDO CENTER DRIVE, SAN DIEGO CA 92128
Andy Bui	officer: VP, CHIEF ACCOUNTING OFFICER	C/O INNOVATIVE INDUSTRIAL PROPERTIES, 11440 WEST BERNARDO COURT, SUITE 100, SAN DIEGO CA 92127
Mary A Curran	director	3 MACARTHUR BLVD, SANTA ANA CA 92707
Gary A Kreitzer	director	17140 BERNARDO CENTER DRIVE, SUITE 195, SAN DIEGO CA 92128
Hg Vora Capital Management, Llc	10 percent owner	330 MADISON AVENUE, 21ST FLOOR, NEW YORK NY 10017
Robert M. Sistek	officer: CFO and EVP, Investments	C/O CORESITE REALTY CORPORATION, 1050 17TH STREET, SUITE 800, DENVER CO 80265
Greg Fahey	officer: CAO and Treasurer	600 LA TERRAZA BOULEVARD, ESCONDIDO CA 92025
Gary Malino	director	C/O PRICESMART, INC., 9740, SAN DIEGO CA 92121