Terreno Realty (TRNO) just posted Q1 2026 results that included higher net income of US$69.4 million and gains on property sales, alongside fresh New York industrial acquisitions and a continued development pipeline.
See our latest analysis for Terreno Realty.
At a share price of US$66.54, Terreno Realty has delivered a 12.74% year to date share price return and a 22.04% total shareholder return over the past year, suggesting momentum has been building alongside recent earnings, dividend affirmations and steady governance updates.
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With Terreno’s shares up 22.04% over the past year and trading close to published analyst targets, the key question now is simple: are you looking at an undervalued industrial REIT, or has the market already priced in future growth?
Price-to-Earnings of 16.7x: Is it justified?
Terreno Realty trades on a P/E of 16.7x, which sits slightly above the global Industrial REITs average but below the broader US market and well under its peer average.
The P/E ratio compares the share price to earnings per share. For an industrial REIT like Terreno it reflects what investors are currently willing to pay for each dollar of profit. With earnings reported as having grown 115.9% over the past year and 28.5% per year over the past 5 years, that 16.7x multiple suggests the market is already factoring in a solid earnings track record while not paying the kind of premium seen across the wider peer group.
Compared to the global Industrial REITs industry average P/E of 16.2x, Terreno is priced a touch higher, which points to investors assigning a modest premium versus the sector. However, relative to the peer average P/E of 32.2x, the current 16.7x looks much more restrained, and even sits below the estimated fair P/E of 17x.
Explore the SWS fair ratio for Terreno Realty
Result: Price-to-Earnings of 16.7x (ABOUT RIGHT)
However, there are still pressure points to watch. These include annual net income growth of 41.28% and Terreno trading only 5.4% below the average analyst price target.
Find out about the key risks to this Terreno Realty narrative.
Another View: Our DCF Model Points the Other Way
While the P/E of 16.7x looks roughly in line with Terreno Realty’s earnings record and fair ratio, the SWS DCF model tells a different story. With the stock at $66.54 versus an estimated future cash flow value of $60.70, it screens as overvalued on this method. So which signal do you put more weight on?
Look into how the SWS DCF model arrives at its fair value.
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Terreno Realty for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 51 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.
Next Steps
Balancing those potential risks against the rewards that investors are optimistic about can feel finely poised, so move quickly, review the data and form your own view by taking a closer look at the 3 key rewards and 3 important warning signs
Ready for more investment ideas?
If Terreno Realty has sharpened your focus, do not stop here. Broaden your watchlist with other ideas that might fit your goals just as well.
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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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