One-glance verdict
Overvalued
$-57.16 our estimate vs market $13.40
Wall Street consensus: $18.50 (-132.4% lower than our fair-value estimate)
123% below our estimate, beyond the bull case
Fundamentals snapshot
Safehold Inc.
SAFE · NYQ · Real Estate · REIT - Diversified
Current price
$13.40
52-week range
$12.76 - $17.45
Market cap
$948.94M
Balance sheet
Stretched
1.51x Concerning
Net debt $4.64B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 8.8% last year.
- Reward Returns 4.6% on equity, ahead of 33% of its peers.
- Risk Net debt grew 27.4% over 3 years.
- Risk Operating margin compressed from 81.0% to 73.7% over 3 years.
What this company does
Safehold Inc.
Safehold owns the land under commercial buildings and charges the building's owner long-term rent to use it, an arrangement known as a ground lease. This business model creates a steady, predictable stream of income for the company from these rent payments. As a REIT (a special type of real estate company that must pass most of its profits to investors), Safehold aims to deliver this income to its shareholders (the people who own the company's stock) through dividends (regular cash payments).
How the company got here
Safehold was formed in 2016 and held its initial public offering (IPO) in 2017, establishing itself as the first publicly-traded company focused on a modern version of a very old real estate concept: the ground lease. It was created by iStar, a larger real estate finance company that became its manager and largest shareholder. The company's goal was to revolutionize real estate ownership by making this updated ground lease a mainstream and more efficient way for property owners to access capital. In 2023, Safehold completed a merger with iStar to simplify its structure and bring its management in-house, positioning itself for future growth.
What it actually does
Imagine you own a large apartment building, but you also own the valuable land underneath it. Safehold's business is to buy the land from you and then lease it back to you for a very long time, often up to 99 years. You get a large sum of cash from selling the land, which you can use for other investments, while you continue to own and operate your building and collect rent from tenants. Safehold, in turn, receives a steady, long-term stream of rental payments from you for the use of the land. The company is structured as a Real Estate Investment Trust (REIT), a type of company that owns income-producing real estate and is required to pay out most of its taxable income to shareholders as dividends (regular payments made to stockholders).
Ground Leases
This is the company's single, core business. Safehold makes money by collecting rent on the land it owns under commercial buildings like apartment complexes, office towers, and hotels. Its customers are the owners and developers of these large-scale properties, who pay Safehold a recurring fee, similar to rent, under a very long-term contract. Because the leases are typically "triple-net," the building owner (the tenant) is responsible for all property-related expenses like maintenance, taxes, and insurance. This structure provides Safehold with a predictable, growing stream of income with relatively low operating costs, as it doesn't have to manage the buildings themselves.
What management is betting on now
Management's strategy is focused on expanding the use of the modern ground lease across the real estate industry, essentially creating and scaling a new asset class. They are educating property owners and lenders on how using a ground lease can be a cheaper and more efficient way to finance their projects compared to other forms of capital. The company is concentrating its efforts on high-quality properties in major US markets, with a particular focus on apartment buildings and affordable housing. By locking in long-term rental streams with built-in increases, Safehold aims to provide its shareholders with safe, growing income and long-term appreciation in the value of its land portfolio.
Price history
How the share price has moved
—
Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
Revenue
$114.65M
Net income
$30.16M
Diluted EPS
0.42
Operating cash flow
$34.63M
Free cash flow
—
Fetching…
Sources
Revenue
$110.85M
Net income
$28.86M
Diluted EPS
0.40
Operating cash flow
$-8.60M
Free cash flow
—
Fetching…
Sources
Revenue
$97.87M
Net income
$27.88M
Diluted EPS
0.38
Operating cash flow
$12.32M
Free cash flow
—
Fetching…
Sources
Revenue
$96.16M
Net income
$29.28M
Diluted EPS
0.41
Operating cash flow
$-1.41M
Free cash flow
—
Fetching…
Sources
Revenue
$93.84M
Net income
$27.95M
Diluted EPS
0.39
Operating cash flow
$28.00M
Free cash flow
—
Fetching…
Sources
Revenue
$97.68M
Net income
$29.36M
Diluted EPS
0.41
Operating cash flow
$8.90M
Free cash flow
—
Fetching…
Sources
Revenue
$91.87M
Net income
$26.04M
Diluted EPS
0.36
Operating cash flow
$7.90M
Free cash flow
—
Fetching…
Sources
Revenue
$90.70M
Net income
$19.33M
Diluted EPS
0.27
Operating cash flow
$8.26M
Free cash flow
—
Fetching…
Sources
Is it cheap or expensive?
Fair value $-57.16 vs current price $13.40
Wall Street consensus is the average analyst price target: $18.50 (-132.4% lower than our fair-value estimate).
Our most-likely fair value is $-57.16 a share — about 526.5% below today's price of $13.40, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Stretched
Net debt $4.6B. Interest coverage 1.5x.
Net debt
$4.64B
Interest coverage
1.51x
Safehold Inc.'s profit covers its interest bill about 1.5 times over. which is weaker than most peers shown here.
Stretched
Worse cushion
Baseline
Better cushion
SAFE
BASELINE
Safehold Inc.
Total debt $4.66B Interest coverage 1.51x This is the baseline the peer rows are being compared against.
Total debt $2.92B Interest coverage 3.32x +121% vs SAFE Carries about 2.2x more debt cushion than SAFE.
Total debt $5.00B Interest coverage 2.79x +85% vs SAFE Carries about 1.9x more debt cushion than SAFE.
Total debt $3.85B Interest coverage 2.58x +71% vs SAFE Carries about 1.7x more debt cushion than SAFE.
Total debt $8.85B Interest coverage 2.99x +99% vs SAFE Carries about 2.0x more debt cushion than SAFE.
Total debt $31.33B Interest coverage 2.34x +56% vs SAFE Carries about 1.6x more debt cushion than SAFE.
What you should know
The case for and against SAFE
3 Rewards
2 Risks
Rewards
-
Revenue grew 8.8% last year.
-
Returns 4.6% on equity, ahead of 33% of its peers.
-
Free cash flow was positive in 4/10 years.
Risks
-
Net debt grew 27.4% over 3 years.
-
Operating margin compressed from 81.0% to 73.7% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
8.32x
Forward P/E
7.89x
P/B
0.39x
P/S
2.17x
EV/EBITDA
16.67x
PEG ratio
—
Profitability
How much profit each dollar creates
Gross margin
92.9%
Operating margin
73.7%
Net margin
26.6%
ROE
4.6%
ROA
2.9%
Health
Liquidity and balance-sheet strength
Debt / equity
1.77x
Current ratio
37.65x
Quick ratio
36.52x
Total debt
$4.66B
Total cash
$15.92M
Growth
How the business has been compounding
Revenue TTM
$419.53M
Revenue 5Y CAGR
19.8%
EPS TTM
1.61
EPS 5Y CAGR
-9.8%
Cash flow
How much cash the business throws off
Operating CF TTM
$36.95M
Free CF TTM
$47.81M
FCF margin
11.4%
Dividend
Shareholder payout
Yield
5.4%
Payout ratio
44.0%
Last ex-div date
2026-09-30