Reviewing American Campus Communities (ACC) and BRT Apartments (BRT)

American Campus Communities (NYSE: ACC) and BRT Apartments (NYSE:BRT) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, valuation, earnings, profitability, institutional ownership and dividends.

Valuation and Earnings

This table compares American Campus Communities and BRT Apartments’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
American Campus Communities $786.36 million 6.69 $99.06 million $0.41 94.08
BRT Apartments $105.77 million 1.76 $13.60 million $0.98 13.58

American Campus Communities has higher revenue and earnings than BRT Apartments. BRT Apartments 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.

Dividends

American Campus Communities pays an annual dividend of $1.76 per share and has a dividend yield of 4.6%. BRT Apartments pays an annual dividend of $0.72 per share and has a dividend yield of 5.4%. 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. BRT Apartments pays out 73.5% of its earnings in the form of a dividend. American Campus Communities has increased its dividend for 5 consecutive years. BRT Apartments is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

American Campus Communities has a beta of 0.28, indicating that its stock price is 72% less volatile than the S&P 500. Comparatively, BRT Apartments has a beta of 0.22, indicating that its stock price is 78% less volatile than the S&P 500.

Insider and Institutional Ownership

22.1% of BRT Apartments shares are held by institutional investors. 0.7% of American Campus Communities shares are held by company insiders. Comparatively, 41.9% of BRT Apartments shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares American Campus Communities and BRT Apartments’ 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%
BRT Apartments 12.86% 6.00% 1.47%

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for American Campus Communities and BRT Apartments, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
American Campus Communities 1 4 9 0 2.57
BRT Apartments 0 1 2 0 2.67

American Campus Communities currently has a consensus target price of $49.50, indicating a potential upside of 28.34%. BRT Apartments has a consensus target price of $11.92, indicating a potential downside of 10.47%. Given American Campus Communities’ higher possible upside, analysts plainly believe American Campus Communities is more favorable than BRT Apartments.

Summary

BRT Apartments beats American Campus Communities on 9 of the 17 factors compared between the two stocks.

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.

BRT Apartments Company Profile

BRT Apartments Corp. is a real estate investment trust (REIT). The Trust is focused on the ownership, operation and development of multi-family properties. These activities are primarily conducted through joint ventures in which the Trust has an equity interest in the entity owning the property. The Trust’s segments include Multi-Family Real Estate and Other Assets. The Multi-Family Real Estate segment includes the ownership, operation and development of multi-family properties. The Other Assets segment includes the ownership and operation of the Trust’s other real estate assets and a real estate loan. As of December 31, 2016, the Trust owned 30 multi-family properties with 8,624 units located in 11 states (including 271 units at a property in the lease up stage), and interests in two unconsolidated joint ventures. The Trust also owns and operates various other real estate assets.

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