Estia Health Care appears to be trading at a 30% discount to...

Estia Health Care appears to be trading at a 30% discount to what I believe to be a fair value ($2.70)

Estia current share price of $2.06 provides the business with a market cap of ~$530m which is just a tad over the current book value of their buildings including current site under construction. This price also excludes the 4 properties just recently acquired also.

As stated in the annual report PP&E is stated at cost with land valued at just $189m I believe this to be well below the actual value of the land (possibly 50% below real value), however if we assume the land has only increased by 6% provides us with a land value for the current operating site of around $200m or $0.77c/share. If we then add back the carrying amount for the building currently in operation approx. $480m we have land & buildings worth approx. $680m or $2.66/share.

This excludes the operating business altogether which if we add back the non-cash expenses & one off expense of bed amortization charge of $60m & covid related expenses was actually profitable. The business actually produced ~$24m in FCF.

So currently in my eyes the business appears to be very mispriced at ~0.75x real BV.

I also think the business could be bought out for a premium of BV call it 1.5x which equates to a SP of $4 / 94% upside.

Keen to hear any thoughts on this or any arguments as to why it shouldn't trade at atleast real book value given the business is expanding & is profitable.