Financial Contrast: Sun Communities (SUI) & Altisource Residential Corporation (RESI)
Sun Communities (NYSE: SUI) and Altisource Residential Corporation (NYSE:RESI) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their institutional ownership, risk, dividends, profitability, analyst recommendations, earnings and valuation.
This is a breakdown of current recommendations and price targets for Sun Communities and Altisource Residential Corporation, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Altisource Residential Corporation||0||4||5||0||2.56|
Sun Communities presently has a consensus target price of $89.00, indicating a potential upside of 0.46%. Altisource Residential Corporation has a consensus target price of $15.50, indicating a potential upside of 36.56%. Given Altisource Residential Corporation’s higher probable upside, analysts clearly believe Altisource Residential Corporation is more favorable than Sun Communities.
Earnings and Valuation
This table compares Sun Communities and Altisource Residential Corporation’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Sun Communities||$936.86 million||7.47||$443.91 million||$0.70||126.56|
|Altisource Residential Corporation||$59.21 million||10.23||-$88.76 million||($4.16)||-2.73|
Sun Communities has higher revenue and earnings than Altisource Residential Corporation. Altisource Residential Corporation is trading at a lower price-to-earnings ratio than Sun Communities, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
94.5% of Sun Communities shares are held by institutional investors. Comparatively, 73.5% of Altisource Residential Corporation shares are held by institutional investors. 4.2% of Sun Communities shares are held by company insiders. Comparatively, 0.1% of Altisource Residential Corporation shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Sun Communities pays an annual dividend of $2.68 per share and has a dividend yield of 3.0%. Altisource Residential Corporation pays an annual dividend of $0.60 per share and has a dividend yield of 5.3%. Sun Communities pays out 382.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Altisource Residential Corporation pays out -14.4% of its earnings in the form of a dividend. Altisource Residential Corporation has increased its dividend for 3 consecutive years. Altisource Residential Corporation is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares Sun Communities and Altisource Residential Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Altisource Residential Corporation||-378.17%||-21.82%||-8.37%|
Risk and Volatility
Sun Communities has a beta of 0.29, meaning that its share price is 71% less volatile than the S&P 500. Comparatively, Altisource Residential Corporation has a beta of 1.99, meaning that its share price is 99% more volatile than the S&P 500.
Sun Communities beats Altisource Residential Corporation on 9 of the 16 factors compared between the two stocks.
About Sun Communities
Sun Communities, Inc. is a self-administered and self-managed real estate investment trust (REIT). The Company is a fully integrated real estate company, which, together with its affiliates and predecessors, has been in the business of acquiring, operating, developing, and expanding manufactured housing (MH) and recreational vehicle (RV). As of December 31, 2016, it owned and operated or had an interest in a portfolio of properties located throughout the United States and Ontario, Canada, including 226 MH communities, 87 RV communities, and 28 properties containing both MH and RV sites. The Company operates through two segments: Real Property Operations and Home Sales and Rentals. The Real Property Operations segment owns, operates, or has an interest in a portfolio, and develops MH communities and RV communities throughout the United States and is in the business of acquiring, operating, and expanding MH and RV communities.
About Altisource Residential Corporation
Altisource Residential Corporation is a real estate investment trust (REIT). The Company focuses on acquiring, owning and managing single-family rental (SFR) properties throughout the United States. The Company conducts its activities through its subsidiary, Altisource Residential, L.P., and its subsidiaries. The Company also converts a portion of the real estate owned (REO) properties that it acquires through resolution of its mortgage loans into SFR properties. The Company has also entered into property management service agreements with two third-party property managers: Altisource Portfolio Solutions, SA (ASPS) and Main Street Renewal, LLC (MSR), to provide, among other things, leasing and lease management, operations, maintenance, repair and property management services in respect of its SFR portfolios. As of December 31, 2016, the Company had 10,533 properties, consisting of 9,939 properties held for use and 594 held for sale.
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