Oak Thistle LLC has sharply expanded its position in Highwoods Properties (HIW), lifting its holding to 77,243 shares in the fourth quarter. This move puts fresh attention on this office focused real estate investment trust.

Highwoods Properties' recent momentum, including a 4.6% 7 day share price return to US$22.42 after a weaker 90 day stretch, sits alongside a 1 year total shareholder return decline of 8.7% and a 25.2% gain over three years, pointing to mixed sentiment around the office REIT.

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With Highwoods trading at US$22.42, at a discount to the consensus price target and an estimated intrinsic value, the key question is whether this gap reflects genuine mispricing or whether the market is already factoring in its future growth.

Most Popular Narrative: 14.9% Undervalued

With Highwoods Properties' fair value estimate sitting at $26.33 against a last close of $22.42, the leading narrative argues the market is not fully reflecting its long term earnings profile, even with softer expectations baked in.

Analysts expect earnings to reach $91.9 million (and earnings per share of $1.0) by about April 2029, down from $157.3 million today. However, there is some disagreement amongst the analysts with the more bearish ones expecting earnings as low as $80.1 million.

Curious how a lower earnings path can still back a higher value than today? The narrative leans on measured revenue growth, slimmer margins, and a much richer future earnings multiple. Want to see which assumptions sit at the heart of that fair value call?

Result: Fair Value of $26.33 (UNDERVALUED)

However, there is still the risk that remote and hybrid work, along with aging assets that require ongoing upgrades, could cap rent growth and keep margins under pressure.

Next Steps

With mixed signals across price, valuation, and earnings expectations, the sentiment around Highwoods is far from one sided. Treat this as a prompt to look under the hood yourself and move quickly to shape your own view with 4 key rewards and 3 important warning signs

Ready for more investment ideas?

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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.