How Vornado Stacks Up against Other Industry Players
VNO’s current price-to-FFO multiple is 17.77x. The company has been able to return value to its shareholders consistently in the form of dividends and share repurchases.
Jul. 27 2017, Updated 7:37 a.m. ET
![uploads///Art Val](https://media.marketrealist.com/brand-img/zPO1xaXwz/480x251/uploads/2017/07/Art-7-Val-6-1.png 480w, https://media.marketrealist.com/brand-img/zPO1xaXwz/640x335/uploads/2017/07/Art-7-Val-6-1.png 640w, https://media.marketrealist.com/brand-img/zPO1xaXwz/768x402/uploads/2017/07/Art-7-Val-6-1.png 768w, https://media.marketrealist.com/brand-img/zPO1xaXwz/1024x536/uploads/2017/07/Art-7-Val-6-1.png 1024w, https://media.marketrealist.com/brand-img/zPO1xaXwz/1280x670/uploads/2017/07/Art-7-Val-6-1.png 1280w, https://media.marketrealist.com/brand-img/zPO1xaXwz/1440x753/uploads/2017/07/Art-7-Val-6-1.png 1440w, https://media.marketrealist.com/brand-img/zPO1xaXwz/1600x837/uploads/2017/07/Art-7-Val-6-1.png 1600w, https://media.marketrealist.com/brand-img/zPO1xaXwz/2160x1130/uploads/2017/07/Art-7-Val-6-1.png 2160w)
Price-to-FFO multiple
Residential REITs (real estate investment trusts) like Vornado Realty Trust (VNO) are best evaluated by the price-to-FFO multiple. The multiple is calculated as the ratio between the price and the FFO (funds from operation) of the company and carries the same significance that the PE (price-to-earnings) multiple has in other industries.
Peer group comparison
VNO’s current price-to-FFO multiple is 17.77x. The company has been able to return value to its shareholders consistently in the form of dividends and share repurchases.
Plus, the company’s sales-boosting initiatives and strategic disposition of assets have helped the company concentrate its properties in the high-demand city of New York.
In terms of price-to-FFO multiple, VNO trades on par with most of its peers like AvalonBay Communities (AVB), Boston Properties (BXP), and Equity Residential (EQR), which trade at price-to-FFO multiples of 22.5x, 19.18x and 21.57x, respectively.
Peer group dividend yield
Vornado offers a next-12-month (or NTM) dividend yield of 3.6%, in line with close competitors like AvalonBay Communities (AVB), Boston Properties (BXP), and Equity Residential (EQR), which offer dividend yields of 3%, 2.5%, and 3.5%, respectively.
Vornado and its above peers make up 12.4% of the iShares Cohen & Steers REIT ETF (ICF).