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American Healthcare REIT, Inc. (AHR) Intrinsic Value

DCF-based fair value calculation with Bear, Base, and Bull scenarios

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American Healthcare REIT, Inc. (AHR)

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Intrinsic Value (DCF)

Current$47.98
→
Intrinsic$35.99
-25%
$20.12$35.99$66.11
Market implies 31% growth for 5 years
AHR trades at a premium to our conservative estimate — investors expect above-average performance.
At $48, the market prices in continued strong cash flow growth (31%) — likely reflecting buybacks, margin stability, and ecosystem strength.
Range: Bear $20 → Bull $66. Current price implies expectations above the base case, closer to bull expectations.
Discount ↓Growth →21%23%25%27%
8%$47$52$58$63
10%$29$32$36$40
12%$19$21$24$27
14%$12$14$17$19

Bull Case

  • Bull case ($66) offers 38% upside at 30% growth, 9% discount

Bear Case

  • Bear case ($20) implies 58% downside at 20% growth, 12% discount
  • Price reflects 31% growth expectations vs 25% historical — high bar to clear
  • Trading 25% above base case — execution must exceed assumptions to justify
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5-Year FFO Projection

Year 1$229.78M
Year 2$287.23M
Year 3$359.03M
Year 4$448.79M
Year 5$560.99M
Terminal$8.25B

📐 Model Inputs

Growth Rate25.0%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base FFO$183.82MTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
ℹ️

DCF estimates based on historical growth rates extrapolated forward. Uses FFO per NAREIT standards. See FAQ below for full methodology.

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Frequently Asked Questions

Is AHR stock undervalued or overvalued?
🔴 OVERVALUED

AHR trades at $47.98 vs. our DCF-derived intrinsic value of $27.46, implying -42% downside. Using a 10.0% WACC and 25.0% FCF growth assumption, the current price requires growth rates above our estimates to be justified. Even our bull case ($48.34) suggests limited upside.

What is AHR's intrinsic value?

Using a 5-year DCF model: Base FCF of $184M, projected at 25.0% 5Y CAGR (best of revenue, EPS, or FCF growth), discounted at 10.0% WACC, with 3.0% terminal growth. Terminal value calculated via Gordon Growth Model: TV = FCF₅ × (1+g) / (WACC−g). After deducting $1.79B net debt and dividing by 0.13B shares: Bear $13.29 | Base $27.46 | Bull $48.34. Current price $47.98 implies -42% to base case.

How is AHR's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 25.0% growth derived from 5-year historical CAGR (best of revenue, EPS, or FCF growth, with 8% floor and 25% cap).

② Calculate terminal value at year 5 using perpetuity growth model with g=3.0%.

③ Discount all cash flows to PV using WACC=10.0%.

④ Sum PV of explicit period + PV of terminal value = Enterprise Value ($5.38B).

⑤ Subtract net debt, divide by shares outstanding.

Sensitivity analysis available above—adjust WACC ±2% or growth ±3% to stress-test the valuation. Implied EV/FCF multiple: 29.3x.