Home Properties (HME) versus Apartment Investment and Management (AIV) Critical Review
Home Properties (NYSE: HME) and Apartment Investment and Management (NYSE:AIV) are both mid-cap financials companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, institutional ownership and earnings.
This is a breakdown of recent ratings and recommmendations for Home Properties and Apartment Investment and Management, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Apartment Investment and Management||1||5||2||0||2.13|
Apartment Investment and Management has a consensus price target of $47.00, suggesting a potential upside of 4.68%. Given Apartment Investment and Management’s higher possible upside, analysts plainly believe Apartment Investment and Management is more favorable than Home Properties.
This table compares Home Properties and Apartment Investment and Management’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Apartment Investment and Management||21.36%||13.81%||3.45%|
Institutional and Insider Ownership
98.8% of Apartment Investment and Management shares are owned by institutional investors. 1.2% of Apartment Investment and Management shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Apartment Investment and Management pays an annual dividend of $1.44 per share and has a dividend yield of 3.2%. Home Properties does not pay a dividend. Apartment Investment and Management pays out 109.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Home Properties has raised its dividend for 6 consecutive years and Apartment Investment and Management has raised its dividend for 6 consecutive years.
Earnings and Valuation
This table compares Home Properties and Apartment Investment and Management’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Apartment Investment and Management||$995.85 million||7.08||$430.41 million||$1.31||34.28|
Apartment Investment and Management has higher revenue and earnings than Home Properties. Home Properties is trading at a lower price-to-earnings ratio than Apartment Investment and Management, indicating that it is currently the more affordable of the two stocks.
Apartment Investment and Management beats Home Properties on 9 of the 11 factors compared between the two stocks.
About Home Properties
Home Properties, Inc. (Home Properties) is a self-administered and self-managed real estate investment trust (REIT). The Company owns, operates, acquires and repositions apartment communities in suburbs of metropolitan areas, primarily along the East Coast of the United States. The Company conducts its business through Home Properties, L.P. (the Operating Partnership), and a management company, Home Properties Resident Services, Inc. (HPRS). As of December 31, 2014, the Company owned and operated 121 communities with 42,107 apartment units. The Company’s properties are two- and three-story garden style apartment buildings in landscaped settings and brick or other masonry construction. As of December 31, 2014, approximately 26.6%, 24.9%, 14.0%, 8.5% and 8.5% of the Company’s Properties are located in the Washington, D.C., Baltimore, Philadelphia, Long Island and Northern New Jersey markets, respectively.
About Apartment Investment and Management
Apartment Investment and Management Company (Aimco) is a self-administered and self-managed real estate investment trust (REIT). Aimco, through its subsidiaries, AIMCO-GP, Inc. and AIMCO-LP Trust, holds the ownership interests in the Aimco Operating Partnership. It operates through two segments: conventional real estate and affordable real estate. As of December 31, 2016, its real estate portfolio consisted of 189 apartment communities with 46,311 apartment homes. Aimco Operating Partnership conducts the Company’s business, which is focused on the ownership, management, redevelopment and limited development of apartment communities located in the coastal and job growth markets of the United States. Its Conventional segment consists of apartment communities it classifies as Conventional Same Store and Conventional Non-Same Store. Its affordable portfolio consists primarily of apartment communities that it manages that are owned through low-income housing tax credit partnerships.
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