Critical Survey: Mid-America Apartment Communities (NYSE:MAA) & Invitation Homes (NYSE:INVH)

Mid-America Apartment Communities (NYSE:MAA – Get Free Report) and Invitation Homes (NYSE:INVH – Get Free Report) are both large-cap real estate companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, dividends, risk and institutional ownership.

Profitability

This table compares Mid-America Apartment Communities and Invitation Homes’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Mid-America Apartment Communities 17.43% 6.89% 3.23%
Invitation Homes 23.54% 7.62% 3.75%

Earnings and Valuation

This table compares Mid-America Apartment Communities and Invitation Homes”s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Mid-America Apartment Communities $2.21 billion 6.26 $446.91 million $3.30 36.11
Invitation Homes $2.73 billion 5.72 $587.92 million $1.14 23.77

Invitation Homes has higher revenue and earnings than Mid-America Apartment Communities. Invitation Homes is trading at a lower price-to-earnings ratio than Mid-America Apartment Communities, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Mid-America Apartment Communities and Invitation Homes, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Mid-America Apartment Communities 2 11 8 0 2.29
Invitation Homes 1 9 11 0 2.48

Mid-America Apartment Communities currently has a consensus price target of $138.06, suggesting a potential upside of 15.84%. Invitation Homes has a consensus price target of $32.00, suggesting a potential upside of 18.08%. Given Invitation Homes’ stronger consensus rating and higher probable upside, analysts plainly believe Invitation Homes is more favorable than Mid-America Apartment Communities.

Institutional and Insider Ownership

93.6% of Mid-America Apartment Communities shares are owned by institutional investors. Comparatively, 96.8% of Invitation Homes shares are owned by institutional investors. 0.6% of Mid-America Apartment Communities shares are owned by insiders. Comparatively, 0.3% of Invitation Homes shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Mid-America Apartment Communities pays an annual dividend of $6.12 per share and has a dividend yield of 5.1%. Invitation Homes pays an annual dividend of $1.20 per share and has a dividend yield of 4.4%. Mid-America Apartment Communities pays out 185.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Invitation Homes pays out 105.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Mid-America Apartment Communities has increased its dividend for 16 consecutive years and Invitation Homes has increased its dividend for 1 consecutive years. Mid-America Apartment Communities is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Mid-America Apartment Communities has a beta of 0.71, suggesting that its stock price is 29% less volatile than the S&P 500. Comparatively, Invitation Homes has a beta of 0.81, suggesting that its stock price is 19% less volatile than the S&P 500.

Summary

Invitation Homes beats Mid-America Apartment Communities on 11 of the 17 factors compared between the two stocks.

About Mid-America Apartment Communities

(Get Free Report)

Mid-America Apartment Communities, Inc. is a real estate investment trust, which engages in the operation, acquisition, and development of apartment communities. It operates through the Same Store and Non-Same Store segments. The Same Store Communities segment represents those apartment communities that have been owned and stabilized for at least 12 months as of the first day of the calendar year. The Non-Same Store segment includes recent acquisitions, communities in development or lease-up. The company was founded in 1994 and is headquartered in Germantown, TN.

About Invitation Homes

(Get Free Report)

Invitation Homes, an S&P 500 company, is the nation's premier single-family home leasing and management company, meeting changing lifestyle demands by providing access to high-quality, updated homes with valued features such as close proximity to jobs and access to good schools. The company's mission, Together with you, we make a house a home, reflects its commitment to providing homes where individuals and families can thrive and high-touch service that continuously enhances residents' living experiences.

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