Preferred Apartment Communities (NYSE: APTS) is one of 42 public companies in the “Residential REITs” industry, but how does it weigh in compared to its competitors? We will compare Preferred Apartment Communities to similar companies based on the strength of its profitability, dividends, earnings, analyst recommendations, valuation, institutional ownership and risk.

Profitability

This table compares Preferred Apartment Communities and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Preferred Apartment Communities 10.49% 2.78% 1.08%
Preferred Apartment Communities Competitors 20.52% 4.13% 1.60%

Institutional and Insider Ownership

52.0% of Preferred Apartment Communities shares are owned by institutional investors. Comparatively, 74.3% of shares of all “Residential REITs” companies are owned by institutional investors. 3.1% of Preferred Apartment Communities shares are owned by insiders. Comparatively, 10.1% of shares of all “Residential REITs” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Preferred Apartment Communities and its competitors top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Preferred Apartment Communities $200.12 million -$9.53 million -20.39
Preferred Apartment Communities Competitors $673.89 million $325.00 million 17.87

Preferred Apartment Communities’ competitors have higher revenue and earnings than Preferred Apartment Communities. Preferred Apartment Communities is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Risk & Volatility

Preferred Apartment Communities has a beta of 0.43, suggesting that its share price is 57% less volatile than the S&P 500. Comparatively, Preferred Apartment Communities’ competitors have a beta of 0.51, suggesting that their average share price is 49% less volatile than the S&P 500.

Dividends

Preferred Apartment Communities pays an annual dividend of $1.00 per share and has a dividend yield of 4.9%. Preferred Apartment Communities pays out -99.0% of its earnings in the form of a dividend. As a group, “Residential REITs” companies pay a dividend yield of 3.6% and pay out 149.6% of their earnings in the form of a dividend. Preferred Apartment Communities is clearly a better dividend stock than its competitors, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Preferred Apartment Communities and its competitors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Preferred Apartment Communities 0 2 2 0 2.50
Preferred Apartment Communities Competitors 190 1239 1272 32 2.42

Preferred Apartment Communities currently has a consensus target price of $19.75, suggesting a potential downside of 4.08%. As a group, “Residential REITs” companies have a potential upside of 6.26%. Given Preferred Apartment Communities’ competitors higher probable upside, analysts clearly believe Preferred Apartment Communities has less favorable growth aspects than its competitors.

Summary

Preferred Apartment Communities competitors beat Preferred Apartment Communities on 11 of the 15 factors compared.

About Preferred Apartment Communities

Preferred Apartment Communities, Inc. is a real estate investment trust (REIT). The Company is formed to acquire and operate multifamily properties in select targeted markets throughout the United States. It operates through segments, including multifamily communities, real estate related financing, new market properties and office buildings. The multifamily communities segment consists of its portfolio of owned residential multifamily communities. The real estate related financing segment consists of the Company’s portfolio of real estate loans, bridge loans, and other instruments deployed by it to partially finance the development, construction, and prestabilization carrying costs of new multifamily communities and other real estate and real estate related assets. The new market properties segment consists of its portfolio of grocery-anchored shopping centers. The office buildings segment consists of its office buildings located in Atlanta, Georgia and Birmingham, Alabama and Texas.

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