Apartment Income REIT (NYSE:AIRC) and Realty Income (NYSE:O) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, risk, profitability, institutional ownership, analyst recommendations, earnings and valuation.
Insider and Institutional Ownership
73.1% of Realty Income shares are held by institutional investors. 0.2% of Realty Income shares are held 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.
Profitability
This table compares Apartment Income REIT and Realty Income's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Apartment Income REIT | N/A | N/A | N/A |
Realty Income | 24.94% | 3.96% | 2.13% |
Dividends
Apartment Income REIT pays an annual dividend of $1.72 per share and has a dividend yield of 4.0%. Realty Income pays an annual dividend of $2.82 per share and has a dividend yield of 4.3%. Realty Income pays out 84.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Realty Income has increased its dividend for 27 consecutive years. Realty Income is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings & Valuation
This table compares Apartment Income REIT and Realty Income's top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Apartment Income REIT | $914.29 million | 7.02 | $474.08 million | N/A | N/A |
Realty Income | $1.49 billion | 16.39 | $436.48 million | $3.32 | 19.71 |
Apartment Income REIT has higher earnings, but lower revenue than Realty Income.
Analyst Ratings
This is a breakdown of current ratings and recommmendations for Apartment Income REIT and Realty Income, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
Apartment Income REIT | 0 | 8 | 2 | 0 | 2.20 |
Realty Income | 0 | 4 | 7 | 1 | 2.75 |
Apartment Income REIT presently has a consensus price target of $42.8889, suggesting a potential downside of 1.11%. Realty Income has a consensus price target of $68.1111, suggesting a potential upside of 3.59%. Given Realty Income's stronger consensus rating and higher probable upside, analysts clearly believe Realty Income is more favorable than Apartment Income REIT.
Summary
Realty Income beats Apartment Income REIT on 13 of the 15 factors compared between the two stocks.