STAG Industrial (STAG): Valuation Update Following Upbeat Q3 Earnings and Raised FFO Guidance

STAG Industrial (NYSE:STAG) delivered an upbeat third quarter, as earnings topped forecasts and management raised its core FFO outlook for the year. Strong leasing trends, new acquisitions, and healthy occupancy set an encouraging tone.

See our latest analysis for STAG Industrial.

STAG Industrial’s shares have gained meaningful traction lately, with a 7% 1-month share price return and nearly 16% year-to-date. This signals renewed optimism as management leans further into acquisitions and development deals. Over the past three and five years, long-term total shareholder returns of 37% and 48% underscore a compelling growth story that is picking up momentum.

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But with a robust financial performance and the stock’s recent rally, investors are left to wonder if STAG Industrial’s growth prospects are already factored into the current price, or if there is still real upside ahead.

Most Popular Narrative: 70% Undervalued

The last close of $38.27 is well below what the most widely followed narrative calculates as STAG Industrial’s fair value. This suggests the market might be discounting stronger long-term fundamentals than many expect.

The company is expanding its development pipeline and acquisition activity at a time when average lease-up periods are lengthening. Industrial supply in some markets, especially larger "big box" assets, is leading to elevated and persistent vacancies, raising the risk of future revenue shortfalls and net margin compression if supply-demand balance worsens.

Read the complete narrative.

Want to know what assumptions drive that striking valuation gap? The narrative’s forecast hinges on future earnings power and a profitability shift that could surprise even seasoned REIT investors. Find out which bold numbers the narrative believes justify this price target.

Result: Fair Value of $52.85 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, robust tenant demand and strong leasing activity, especially in supply-constrained markets, could bolster future earnings and challenge the prevailing bearish narrative.

Find out about the key risks to this STAG Industrial narrative.

Build Your Own STAG Industrial Narrative

If the consensus view does not fit with your personal analysis, you can quickly assemble your own investment narrative using the available data in just a few minutes. Do it your way

A great starting point for your STAG Industrial research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data 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 financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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