American Residential Properties (NYSE: ARPI) and Independence Realty Trust (NYSE:IRT) are both financials companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, earnings, profitability, analyst recommendations, institutional ownership, valuation and dividends.
American Residential Properties pays an annual dividend of $0.40 per share. Independence Realty Trust pays an annual dividend of $0.72 per share and has a dividend yield of 8.4%. American Residential Properties pays out -28.6% of its earnings in the form of a dividend. Independence Realty Trust pays out -276.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Independence Realty Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.
This table compares American Residential Properties and Independence Realty Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|American Residential Properties||-38.70%||-9.17%||-3.64%|
|Independence Realty Trust||-10.91%||-3.08%||-1.28%|
Institutional & Insider Ownership
78.6% of Independence Realty Trust shares are held by institutional investors. 0.6% of Independence Realty Trust shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Valuation & Earnings
This table compares American Residential Properties and Independence Realty Trust’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|American Residential Properties||N/A||N/A||N/A||($1.40)||N/A|
|Independence Realty Trust||$153.36 million||4.67||-$9.80 million||($0.26)||-32.96|
American Residential Properties has higher earnings, but lower revenue than Independence Realty Trust. Independence Realty Trust is trading at a lower price-to-earnings ratio than American Residential Properties, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings and price targets for American Residential Properties and Independence Realty Trust, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|American Residential Properties||0||0||0||0||N/A|
|Independence Realty Trust||0||1||5||0||2.83|
Independence Realty Trust has a consensus target price of $11.20, suggesting a potential upside of 30.69%.
Independence Realty Trust beats American Residential Properties on 10 of the 11 factors compared between the two stocks.
American Residential Properties Company Profile
American Residential Properties, Inc. is an internally managed real estate investment company, which is organized as a real estate investment trust. The Company acquires, owns, renovates, and manages single-family homes as rental properties. American Residential Properties OP, L.P. acts as its operating partnership. American Residential Leasing Company, LLC is a wholly owned subsidiary of its operating partnership. The Company owns 8,893 properties in Arizona, California, Colorado, Florida, Georgia, Illinois, Indiana, Nevada, North Carolina, Ohio, South Carolina, Tennessee and Texas that were 81% leased, and it managed an additional 437 properties for ARP Phoenix Fund I, LP in Arizona and Nevada. In addition to its primary business, the Company has a private mortgage financing business.
Independence Realty Trust Company Profile
Independence Realty Trust, Inc. is an internally-managed real estate investment trust (REIT). The Company is engaged in the business of owning, managing, operating, leasing, acquiring, developing, investing in, and disposing of real estate assets. The Company owns apartment properties in geographic non-gateway markets. As of September 26, 2017, the Company owns and operates 55 multifamily apartment properties, totaling 15,165 units. Its properties include Copper Mill, Crestmont, Heritage Trace, Runaway Bay, Berkshire Square, The Crossings, Reserve at Eagle Ridge, Windrush, Heritage Park, Raindance, Augusta, Invitational, Carrington Park, Walnut Hill, Lenoxplace, Bennington Pond, Jamestown, Meadows, Oxmoor, Bayview Club, Arbors River Oaks, Fox Trails, Bridge Pointe, The Aventine Greenville and Westmont Commons.
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