Understanding AFFO for REITs: The REIT Equivalent of Free Cash Flow
Estimating a valuation for a REIT is vastly different than a valuation for any other company because of the unique business model for REITs. That’s why investors need to use REIT-specific metrics such as FFO (Funds from Operations) and AFFO (adjusted Funds from Operations) to estimate Free Cash Flow and valuations. Creating a rough estimate […]
Degree of Total Leverage (DTL) – CFA Level 1
The term degree of total leverage (DTL) is a measure of a company’s overall sensitivity in bottom-line net income to a change in sales. The metric captures the degree of operating leverage (DOL) and the degree of financial leverage (DFL) to measure the total degree of leverage at the company, as can be seen in […]
