American Campus Communities (NYSE: ACC) and Altisource Residential (NYSE:RESI) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, profitability, valuation, risk, institutional ownership and earnings.
Earnings & Valuation
This table compares American Campus Communities and Altisource Residential’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|American Campus Communities||$786.36 million||7.46||$99.06 million||$0.41||104.86|
|Altisource Residential||$56.76 million||10.21||-$228.02 million||($3.90)||-2.78|
American Campus Communities has higher revenue and earnings than Altisource Residential. Altisource Residential is trading at a lower price-to-earnings ratio than American Campus Communities, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
American Campus Communities has a beta of 0.27, suggesting that its stock price is 73% less volatile than the S&P 500. Comparatively, Altisource Residential has a beta of 1.95, suggesting that its stock price is 95% more volatile than the S&P 500.
Insider & Institutional Ownership
70.5% of Altisource Residential shares are held by institutional investors. 0.7% of American Campus Communities shares are held by insiders. Comparatively, 0.5% of Altisource Residential shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
This table compares American Campus Communities and Altisource Residential’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|American Campus Communities||7.16%||1.58%||0.89%|
This is a summary of recent recommendations and price targets for American Campus Communities and Altisource Residential, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|American Campus Communities||0||5||8||0||2.62|
American Campus Communities presently has a consensus price target of $52.22, indicating a potential upside of 21.48%. Altisource Residential has a consensus price target of $15.67, indicating a potential upside of 44.53%. Given Altisource Residential’s stronger consensus rating and higher probable upside, analysts clearly believe Altisource Residential is more favorable than American Campus Communities.
American Campus Communities pays an annual dividend of $1.76 per share and has a dividend yield of 4.1%. Altisource Residential pays an annual dividend of $0.60 per share and has a dividend yield of 5.5%. American Campus Communities pays out 429.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Altisource Residential pays out -15.4% of its earnings in the form of a dividend. American Campus Communities has raised its dividend for 3 consecutive years and Altisource Residential has raised its dividend for 4 consecutive years. Altisource Residential is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
American Campus Communities Company Profile
American Campus Communities, Inc. is a self-managed and self-administered equity real estate investment trust (REIT). The Company’s segments include Wholly-Owned Properties, On-Campus Participating Properties, Development Services, and Property Management Services. It is engaged in the acquisition, design, financing, development, construction management, leasing and management of student housing properties. The Wholly-Owned Properties segment consists of off-campus properties, which are located in close proximity to the school campus. The On-Campus Participating Properties segment includes on-campus properties that are operated under long-term ground/facility leases with three university systems. The Development Services segment consists of development and construction management services that it provides through one of its taxable REIT subsidiaries for third-party owners. The Property Management Services segment includes revenues generated from third-party management contracts.
Altisource Residential Company Profile
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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