Critical Review: Apartment Investment and Management (AIV) vs. Its Peers

Apartment Investment and Management (NYSE:AIV) is one of 57 publicly-traded companies in the “Residential REITs” industry, but how does it weigh in compared to its peers? We will compare Apartment Investment and Management to similar companies based on the strength of its earnings, profitability, dividends, analyst recommendations, risk, institutional ownership and valuation.

Earnings & Valuation

This table compares Apartment Investment and Management and its peers revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Apartment Investment and Management	$138.49 million	$554.01 million	0.42
Apartment Investment and Management Competitors	$774.95 million	$238.42 million	37.15

Apartment Investment and Management’s peers have higher revenue, but lower earnings than Apartment Investment and Management. Apartment Investment and Management is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Risk and Volatility

Apartment Investment and Management has a beta of 1.21, indicating that its share price is 21% more volatile than the S&P 500. Comparatively, Apartment Investment and Management’s peers have a beta of 0.69, indicating that their average share price is 31% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and recommmendations for Apartment Investment and Management and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Apartment Investment and Management	1	0	0	0	1.00
Apartment Investment and Management Competitors	618	3255	3369	147	2.41

As a group, “Residential REITs” companies have a potential upside of 15.23%. Given Apartment Investment and Management’s peers stronger consensus rating and higher possible upside, analysts clearly believe Apartment Investment and Management has less favorable growth aspects than its peers.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Apartment Investment and Management	N/A	N/A	N/A
Apartment Investment and Management Competitors	8.75%	2.00%	2.16%

Institutional and Insider Ownership

83.3% of Apartment Investment and Management shares are held by institutional investors. Comparatively, 55.7% of shares of all “Residential REITs” companies are held by institutional investors. 3.9% of Apartment Investment and Management shares are held by company insiders. Comparatively, 8.5% of shares of all “Residential REITs” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Apartment Investment and Management pays an annual dividend of $1.30 per share and has a dividend yield of 80.5%. Apartment Investment and Management pays out 33.5% of its earnings in the form of a dividend. As a group, “Residential REITs” companies pay a dividend yield of 4.8% and pay out 219.6% of their earnings in the form of a dividend. Apartment Investment and Management is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Summary

Apartment Investment and Management peers beat Apartment Investment and Management on 10 of the 15 factors compared.

Apartment Investment and Management Company Profile

Apartment Investment & Management Co. operates as a real estate investment trust that engages in the acquisition, ownership, management and redevelopment of apartment properties. The company was founded in 1975 and is headquartered in Denver, CO.