Using the industry peer median P/E multiple (trailing + forward), Equity Residential (EQR) has a fair value of $58.69 based on 6 comparable companies in the REIT - Residential industry.
USD in millions except Fair Price. Subject company highlighted.
| Mkt Cap ($M) | Trailing P/E | Forward P/E | |
|---|---|---|---|
| Equity ResidentialEQR | 23,164 | 20.5x | 44.8x |
| Extra Space Storage Inc.EXR | 27,531 | 28.4x | 27.9x |
| AvalonBay Communities, Inc.AVB | 23,267 | 22.2x | 33.2x |
| SBA Communications CorporationSBAC | 17,519 | 16.9x | 21.8x |
| Essex Property Trust, Inc.ESS | 15,737 | 23.4x | 42.3x |
| Invitation Homes Inc.INVH | 15,286 | 26.0x | 36.2x |
| Mid-America Apartment Communities, Inc.MAA | 14,324 | 32.4x | 36.4x |
| Industry Median | 24.7x | 34.7x | |
| (*) Profit after tax | 1,120 | 517 | |
| Equity Value | 27,677 | 17,953 | |
| (/) Outstanding shares | 389 | 389 | |
| Fair Price | $71 | $46 | |
This P/E relative valuation uses the industry peer median Price-to-Earnings ratio to estimate fair value. Both trailing (last 12 months) and forward (next fiscal year analyst estimates) P/E multiples are computed independently.
The industry median trailing P/E is applied to the company's TTM net income, and the forward P/E to analyst-estimated net income. Each produces an equity value divided by shares outstanding to yield a fair price per share. The selected fair value is the average of the trailing and forward legs.