Analyzing United Dominion Realty Trust (NYSE:UDR) and Elme Communities (NYSE:ELME)

United Dominion Realty Trust (NYSE:UDR) and Elme Communities (NYSE:ELME) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, risk, analyst recommendations, profitability, earnings, institutional ownership and valuation.

Analyst Recommendations

This is a summary of recent ratings and target prices for United Dominion Realty Trust and Elme Communities, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Dominion Realty Trust	2	8	5	0	2.20
Elme Communities	1	2	0	0	1.67

United Dominion Realty Trust currently has a consensus price target of $40.82, indicating a potential upside of 19.58%. Elme Communities has a consensus price target of $18.00, indicating a potential upside of 793.74%. Given Elme Communities’ higher possible upside, analysts clearly believe Elme Communities is more favorable than United Dominion Realty Trust.

Earnings & Valuation

This table compares United Dominion Realty Trust and Elme Communities”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Dominion Realty Trust	$1.71 billion	6.55	$377.70 million	$1.13	30.21
Elme Communities	$206.36 million	0.87	-$154.16 million	($1.52)	-1.33

United Dominion Realty Trust has higher revenue and earnings than Elme Communities. Elme Communities is trading at a lower price-to-earnings ratio than United Dominion Realty Trust, indicating that it is currently the more affordable of the two stocks.

Dividends

United Dominion Realty Trust pays an annual dividend of $1.72 per share and has a dividend yield of 5.0%. Elme Communities pays an annual dividend of $0.36 per share and has a dividend yield of 17.9%. United Dominion Realty Trust pays out 152.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Elme Communities pays out -23.7% of its earnings in the form of a dividend. United Dominion Realty Trust has raised its dividend for 15 consecutive years. Elme Communities is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

United Dominion Realty Trust has a beta of 0.71, indicating that its share price is 29% less volatile than the S&P 500. Comparatively, Elme Communities has a beta of 0.69, indicating that its share price is 31% less volatile than the S&P 500.

Institutional & Insider Ownership

97.8% of United Dominion Realty Trust shares are owned by institutional investors. Comparatively, 87.9% of Elme Communities shares are owned by institutional investors. 3.4% of United Dominion Realty Trust shares are owned by insiders. Comparatively, 1.4% of Elme Communities shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares United Dominion Realty Trust and Elme Communities’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Dominion Realty Trust	22.06%	11.58%	3.55%
Elme Communities	-74.71%	-20.43%	-8.29%

Summary

United Dominion Realty Trust beats Elme Communities on 14 of the 17 factors compared between the two stocks.

About United Dominion Realty Trust

UDR, Inc. (NYSE: UDR), an S&P 500 company, is a leading multifamily real estate investment trust with a demonstrated performance history of delivering superior and dependable returns by successfully managing, buying, selling, developing and redeveloping attractive real estate communities in targeted U.S. markets. As of December 31, 2023, UDR owned or had an ownership position in 60,336 apartment homes including 359 homes under development. For over 51 years, UDR has delivered long-term value to shareholders, the best standard of service to Residents and the highest quality experience for Associates.

About Elme Communities

Elme Communities is committed to elevating what home can be for middle-income renters by providing a higher level of quality, service, and experience. The Company is a multifamily real estate investment trust that owns and operates approximately 9,400 apartment homes in the Washington, DC metro and the Atlanta metro regions, and owns approximately 300,000 square feet of commercial space. Focused on providing quality, affordable homes to a deep, solid, and underserved base of mid-market demand, Elme Communities is building long-term value for shareholders.