Annaly Capital Management (NYSE:NLY) and Apple Hospitality REIT (NYSE:APLE) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, dividends, earnings, profitability, valuation and risk.
Risk and Volatility
Annaly Capital Management has a beta of 1.15, suggesting that its stock price is 15% more volatile than the S&P 500. Comparatively, Apple Hospitality REIT has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500.
Profitability
This table compares Annaly Capital Management and Apple Hospitality REIT's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Annaly Capital Management | -20.12% | 13.27% | 1.57% |
| Apple Hospitality REIT | -12.73% | -3.05% | -1.91% |
Analyst Ratings
This is a summary of recent ratings and price targets for Annaly Capital Management and Apple Hospitality REIT, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Annaly Capital Management | 0 | 2 | 10 | 0 | 2.83 |
| Apple Hospitality REIT | 0 | 4 | 2 | 0 | 2.33 |
Annaly Capital Management currently has a consensus target price of $8.1042, suggesting a potential downside of 7.59%. Apple Hospitality REIT has a consensus target price of $13.00, suggesting a potential downside of 14.13%. Given Annaly Capital Management's stronger consensus rating and higher possible upside, equities research analysts plainly believe Annaly Capital Management is more favorable than Apple Hospitality REIT.
Insider and Institutional Ownership
44.6% of Annaly Capital Management shares are held by institutional investors. Comparatively, 64.2% of Apple Hospitality REIT shares are held by institutional investors. 0.4% of Annaly Capital Management shares are held by company insiders. Comparatively, 6.5% of Apple Hospitality REIT shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Dividends
Annaly Capital Management pays an annual dividend of $0.88 per share and has a dividend yield of 10.0%. Apple Hospitality REIT pays an annual dividend of $0.04 per share and has a dividend yield of 0.3%. Annaly Capital Management pays out 88.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Apple Hospitality REIT pays out 2.5% of its earnings in the form of a dividend. Annaly Capital Management has raised its dividend for 1 consecutive years. Annaly Capital Management is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation & Earnings
This table compares Annaly Capital Management and Apple Hospitality REIT's revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Annaly Capital Management | $3.79 billion | 3.23 | $-2,162,860,000.00 | $1.00 | 8.76 |
| Apple Hospitality REIT | $1.27 billion | 2.67 | $171.92 million | $1.63 | 9.28 |
Apple Hospitality REIT has lower revenue, but higher earnings than Annaly Capital Management. Annaly Capital Management is trading at a lower price-to-earnings ratio than Apple Hospitality REIT, indicating that it is currently the more affordable of the two stocks.
Summary
Annaly Capital Management beats Apple Hospitality REIT on 10 of the 17 factors compared between the two stocks.
