American Homes 4 Rent (NYSE:AMH) and Acadia Realty Trust (NYSE:AKR) are both mid-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, earnings, analyst recommendations, institutional ownership, risk and valuation.
Insider and Institutional Ownership
86.9% of American Homes 4 Rent shares are owned by institutional investors. 27.6% of American Homes 4 Rent shares are owned by insiders. Comparatively, 2.5% of Acadia Realty Trust shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
This is a summary of recent recommendations for American Homes 4 Rent and Acadia Realty Trust, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|American Homes 4 Rent||0||3||5||0||2.63|
|Acadia Realty Trust||0||1||2||0||2.67|
American Homes 4 Rent currently has a consensus target price of $23.83, suggesting a potential upside of 2.25%. Acadia Realty Trust has a consensus target price of $31.33, suggesting a potential upside of 11.71%. Given Acadia Realty Trust’s stronger consensus rating and higher possible upside, analysts plainly believe Acadia Realty Trust is more favorable than American Homes 4 Rent.
Volatility and Risk
American Homes 4 Rent has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500. Comparatively, Acadia Realty Trust has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500.
American Homes 4 Rent pays an annual dividend of $0.20 per share and has a dividend yield of 0.9%. Acadia Realty Trust pays an annual dividend of $1.12 per share and has a dividend yield of 4.0%. American Homes 4 Rent pays out 18.9% of its earnings in the form of a dividend. Acadia Realty Trust pays out 83.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Acadia Realty Trust has raised its dividend for 6 consecutive years. Acadia Realty Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares American Homes 4 Rent and Acadia Realty Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|American Homes 4 Rent||10.09%||1.83%||1.21%|
|Acadia Realty Trust||11.95%||1.48%||0.80%|
Earnings and Valuation
This table compares American Homes 4 Rent and Acadia Realty Trust’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|American Homes 4 Rent||$1.07 billion||6.45||$108.27 million||$1.06||21.99|
|Acadia Realty Trust||$262.21 million||8.84||$31.17 million||$1.35||20.78|
American Homes 4 Rent has higher revenue and earnings than Acadia Realty Trust. Acadia Realty Trust is trading at a lower price-to-earnings ratio than American Homes 4 Rent, indicating that it is currently the more affordable of the two stocks.
American Homes 4 Rent beats Acadia Realty Trust on 9 of the 16 factors compared between the two stocks.
About American Homes 4 Rent
American Homes 4 Rent (NYSE: AMH) is a leader in the single-family home rental industry and "American Homes 4 Rent" is fast becoming a nationally recognized brand for rental homes, known for high quality, good value and tenant satisfaction. We are an internally managed Maryland real estate investment trust, or REIT, focused on acquiring, renovating, leasing, and operating attractive, single-family homes as rental properties. As of December 31, 2018, we owned 52,783 single-family properties in selected submarkets in 22 states.
About Acadia Realty Trust
Acadia Realty Trust is an equity real estate investment trust focused on delivering long-term, profitable growth via its dual – Core and Fund – operating platforms and its disciplined, location-driven investment strategy. Acadia Realty Trust is accomplishing this goal by building a best-in-class core real estate portfolio with meaningful concentrations of assets in the nation's most dynamic urban and street-retail corridors; making profitable opportunistic and value-add investments through its series of discretionary, institutional funds; and maintaining a strong balance sheet.
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