Is Alexandria Real Estate Equities (ARE) Offering Value After Its Sharp Multi Year Pullback

Simply Wall St.01-17

If you are wondering whether Alexandria Real Estate Equities is priced attractively right now, you are not alone, especially with so much attention on real estate stocks and their underlying assets. ...

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However, the 1 year, 3 year, and 5 year returns of negative 39.1%, negative 56.8%, and negative 59.0% show a very different picture.\nThese moves have put Alexandria Real Estate Equities back on...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4194":"办公房地产投资信托","BK4225":"医疗保健房地产信托","BK4588":"碎股","BK4223":"办公室房地产信托","DCF":"Dreyfus Alcentra Global Credit Income 2024 Target Term Fund, Inc","ARE":"亚历山大房地产","BK4585":"ETF&股票定投概念","ARE.AU":"Argonaut Resources N L","BK7104":"黄金"},"translate_title":"亚历山大房地产股票(ARE)在经历多年大幅回调后是否具有价值","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"ARE.AU":1.5,"DCF":1,"ARE":1.5},"content_text":"If you are wondering whether Alexandria Real Estate Equities is priced attractively right now, you are not alone, especially with so much attention on real estate stocks and their underlying assets. The share price recently closed at US$57.26, with returns of 7.5% over 7 days and 21.9% over 30 days. However, the 1 year, 3 year, and 5 year returns of negative 39.1%, negative 56.8%, and negative 59.0% show a very different picture. These moves have put Alexandria Real Estate Equities back on many investors' watchlists, as the recent rebound contrasts with the longer multi year pullback. This kind of mixed return profile often leads investors to reassess what they are really paying for the portfolio of life science and office properties the company owns. On our valuation checks, Alexandria Real Estate Equities scores 5 out of 6, and you can see the breakdown in our valuation score. Next, we will run through the usual valuation methods before finishing with a different way of looking at value that can help you put all of these numbers into context.  Find out why Alexandria Real Estate Equities's -39.1% return over the last year is lagging behind its peers. AdvertisementApproach 1: Alexandria Real Estate Equities Discounted Cash Flow (DCF) Analysis A Discounted Cash Flow, or DCF, model estimates what a company might be worth by projecting its future adjusted funds from operations and discounting those cash flows back to today in dollars. For Alexandria Real Estate Equities, the latest twelve month free cash flow stands at about $1.63b. Analysts provide free cash flow estimates out to 2028, with Simply Wall St extrapolating further to build a 10 year path. Those projections run from $849.21m in 2026 through to $1.16b in 2035, with each year discounted back to reflect the time value of money and risk. Adding those discounted cash flows together and including a terminal value produces an estimated intrinsic value of $81.47 per share. Compared with the recent share price of $57.26, the model suggests the stock is trading at roughly a 29.7% discount to this DCF estimate, based on these assumptions and inputs. Result: UNDERVALUED (according to this DCF model) Our Discounted Cash Flow (DCF) analysis suggests Alexandria Real Estate Equities is undervalued by 29.7%. Track this in your watchlist or portfolio, or discover 868 more undervalued stocks based on cash flows. ARE Discounted Cash Flow as at Jan 2026 Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Alexandria Real Estate Equities. Approach 2: Alexandria Real Estate Equities Price vs Sales For profitable real estate companies, the price to sales, or P/S, ratio can be a useful way to think about what you are paying for each dollar of revenue, especially when earnings or funds from operations can be affected by non cash items. In general, higher growth expectations and lower perceived risk can justify a higher P/S multiple, while slower growth or higher risk tends to support a lower, more conservative range. So the question is what looks reasonable for Alexandria Real Estate Equities today. Alexandria Real Estate Equities currently trades on a P/S of 3.24x. This sits below the Health Care REITs industry average of 6.52x and the peer average of 5.92x. Simply Wall St also calculates a proprietary “Fair Ratio” of 3.97x, which is the P/S multiple that might be expected given factors such as earnings growth, profit margins, industry, market cap and company specific risks. The Fair Ratio aims to be more tailored than a simple industry or peer comparison because it is based on company specific fundamentals rather than broad group averages. With the current P/S of 3.24x versus a Fair Ratio of 3.97x, the shares look undervalued on this metric. Result: UNDERVALUED NYSE:ARE P/S Ratio as at Jan 2026 P/S ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1442 companies where insiders are betting big on explosive growth. Upgrade Your Decision Making: Choose your Alexandria Real Estate Equities Narrative Earlier we mentioned that there is an even better way to understand valuation. On Simply Wall St's Community page you can use Narratives, where you set out your story for Alexandria Real Estate Equities, link that story to your own revenue, earnings and margin forecasts, translate those into a fair value, then compare it with the current price to guide buy or sell decisions. The Narrative updates automatically when new earnings or news arrive. One investor might build a Narrative around premium life science assets, long term leases and the US$96.42 consensus target, while another might focus on weaker revenue growth, reduced profit margins and the trimmed US$58.33 fair value, leading to very different views on what the shares are worth today. Do you think there's more to the story for Alexandria Real Estate Equities? Head over to our Community to see what others are saying! NYSE:ARE 1-Year Stock Price Chart  This article by Simply Wall St is general in nature. We provide commentary based on historical data\n    and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your\n    financial situation. We aim to bring you long-term focused analysis driven by fundamental data.\n    Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.\n    Simply Wall St has no position in any stocks mentioned.New: Manage All Your Stock Portfolios in One PlaceWe've created the ultimate portfolio companion for stock investors, and it's free.• Connect an unlimited number of Portfolios and see your total in one currency• Be alerted to new Warning Signs or Risks via email or mobile• Track the Fair Value of your stocksTry a Demo Portfolio for FreeHave feedback on this article? Concerned about the content? Get in touch with us directly. 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