Equity Residential (NYSE: EQR) and Camden Property Trust (NYSE:CPT) are both mid-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their risk, valuation, earnings, dividends, institutional ownership, profitability and analyst recommendations.
Volatility & Risk
Equity Residential has a beta of 0.37, meaning that its share price is 63% less volatile than the S&P 500. Comparatively, Camden Property Trust has a beta of 0.42, meaning that its share price is 58% less volatile than the S&P 500.
Insider and Institutional Ownership
91.6% of Equity Residential shares are held by institutional investors. Comparatively, 96.7% of Camden Property Trust shares are held by institutional investors. 3.8% of Equity Residential shares are held by insiders. Comparatively, 4.7% of Camden Property Trust shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Earnings & Valuation
This table compares Equity Residential and Camden Property Trust’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Equity Residential||$2.43 billion||10.32||$4.29 billion||$2.04||33.38|
|Camden Property Trust||$876.45 million||9.92||$819.82 million||$1.64||57.21|
Equity Residential has higher revenue and earnings than Camden Property Trust. Equity Residential is trading at a lower price-to-earnings ratio than Camden Property Trust, indicating that it is currently the more affordable of the two stocks.
This is a summary of current ratings and price targets for Equity Residential and Camden Property Trust, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Camden Property Trust||0||6||9||0||2.60|
Equity Residential currently has a consensus target price of $69.15, suggesting a potential upside of 1.55%. Camden Property Trust has a consensus target price of $92.73, suggesting a potential downside of 1.16%. Given Equity Residential’s higher possible upside, research analysts clearly believe Equity Residential is more favorable than Camden Property Trust.
This table compares Equity Residential and Camden Property Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Camden Property Trust||16.81%||4.71%||2.50%|
Equity Residential pays an annual dividend of $2.02 per share and has a dividend yield of 3.0%. Camden Property Trust pays an annual dividend of $3.00 per share and has a dividend yield of 3.2%. Equity Residential pays out 99.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Camden Property Trust pays out 182.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Equity Residential has raised its dividend for 6 consecutive years.
Equity Residential beats Camden Property Trust on 11 of the 17 factors compared between the two stocks.
About Equity Residential
Equity Residential is a real estate investment trust. The Company’s primary business is the acquisition, development and management of multifamily residential properties. Its segments include Boston, New York, Washington D.C., Southern California, San Francisco, Seattle and Other Markets. Southern California includes Los Angeles, San Diego and Orange County. Other Markets includes Phoenix. It is engaged in leasing of apartment units to residents. It focuses on rental apartment properties in urban and high-density suburban coastal gateway markets. As of December 31, 2016, the Company owned 302 properties located in 10 states and the District of Columbia consisting of 77,458 apartment units. The Company’s projects include The Alton, 455 Eye Street, 855 Brannan, Cascade, One Henry Adams, 340 Fremont and Vista 99. ERP Operating Limited Partnership (ERPOP) conducts the multifamily residential property business of Equity Residential.
About Camden Property Trust
Camden Property Trust is a real estate investment trust (REIT). The Company is engaged in the ownership, management, development, redevelopment, acquisition and construction of multifamily apartment communities. As of December 31, 2016, the Company owned interests in, operated, or were developing 159 multifamily properties, which consisted of 55,366 apartment homes across the United States. The Company also owns land holdings, which it may develop into multifamily communities. The Company’s properties consist of mid-rise buildings or two and three story buildings in a landscaped setting and provide residents with a range of amenities common to multifamily rental properties. The 152 operating properties in which the Company owned interests and operated, as of December 31, 2016, averaged 953 square feet of living area per apartment home. As of December 31, 2016, 137 of its operating properties had over 200 apartment homes.
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