Comparing Apartment Investment and Management (AIV) & Sun Communities (SUI)

Apartment Investment and Management (NYSE: AIV) and Sun Communities (NYSE:SUI) are both mid-cap financials companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, earnings, risk and valuation.

Risk & Volatility

Apartment Investment and Management has a beta of 0.46, meaning that its share price is 54% less volatile than the S&P 500. Comparatively, Sun Communities has a beta of 0.27, meaning that its share price is 73% less volatile than the S&P 500.

Insider & Institutional Ownership

98.2% of Apartment Investment and Management shares are owned by institutional investors. Comparatively, 93.5% of Sun Communities shares are owned by institutional investors. 1.2% of Apartment Investment and Management shares are owned by insiders. Comparatively, 4.2% of Sun Communities shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Apartment Investment and Management and Sun Communities’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Apartment Investment and Management $995.85 million 6.40 $430.41 million $0.31 130.97
Sun Communities $833.78 million 8.36 $31.32 million $0.74 118.69

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

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Apartment Investment and Management and Sun Communities, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Apartment Investment and Management 1 4 4 0 2.33
Sun Communities 0 2 4 0 2.67

Apartment Investment and Management presently has a consensus price target of $47.38, indicating a potential upside of 16.69%. Sun Communities has a consensus price target of $92.00, indicating a potential upside of 4.75%. Given Apartment Investment and Management’s higher probable upside, research analysts clearly believe Apartment Investment and Management is more favorable than Sun Communities.

Profitability

This table compares Apartment Investment and Management and Sun Communities’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Apartment Investment and Management 21.36% 13.81% 3.45%
Sun Communities 7.37% 2.76% 1.17%

Dividends

Apartment Investment and Management pays an annual dividend of $1.44 per share and has a dividend yield of 3.5%. Sun Communities pays an annual dividend of $2.68 per share and has a dividend yield of 3.1%. Apartment Investment and Management pays out 464.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sun Communities pays out 362.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sun Communities has raised its dividend for 7 consecutive years.

Summary

Apartment Investment and Management beats Sun Communities on 10 of the 16 factors compared between the two stocks.

About Apartment Investment and Management

Apartment Investment and Management Company (Aimco) is a self-administered and self-managed real estate investment trust (REIT). Aimco, through its subsidiaries, AIMCO-GP, Inc. and AIMCO-LP Trust, holds the ownership interests in the Aimco Operating Partnership. It operates through two segments: conventional real estate and affordable real estate. As of December 31, 2016, its real estate portfolio consisted of 189 apartment communities with 46,311 apartment homes. Aimco Operating Partnership conducts the Company’s business, which is focused on the ownership, management, redevelopment and limited development of apartment communities located in the coastal and job growth markets of the United States. Its Conventional segment consists of apartment communities it classifies as Conventional Same Store and Conventional Non-Same Store. Its affordable portfolio consists primarily of apartment communities that it manages that are owned through low-income housing tax credit partnerships.

About Sun Communities

Sun Communities, Inc. is a self-administered and self-managed real estate investment trust (REIT). The Company is a fully integrated real estate company, which, together with its affiliates and predecessors, has been in the business of acquiring, operating, developing, and expanding manufactured housing (MH) and recreational vehicle (RV). As of December 31, 2016, it owned and operated or had an interest in a portfolio of properties located throughout the United States and Ontario, Canada, including 226 MH communities, 87 RV communities, and 28 properties containing both MH and RV sites. The Company operates through two segments: Real Property Operations and Home Sales and Rentals. The Real Property Operations segment owns, operates, or has an interest in a portfolio, and develops MH communities and RV communities throughout the United States and is in the business of acquiring, operating, and expanding MH and RV communities.

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