Financial Contrast: Invitation Home (NYSE:INVH) versus Mid-America Apartment Communities (NYSE:MAA)

Mid-America Apartment Communities (NYSE:MAA) and Invitation Home (NYSE:INVH) are both large-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, valuation, profitability and institutional ownership.

Insider & Institutional Ownership

93.6% of Mid-America Apartment Communities shares are owned by institutional investors. Comparatively, 96.8% of Invitation Home shares are owned by institutional investors. 1.2% of Mid-America Apartment Communities shares are owned by company insiders. Comparatively, 0.3% of Invitation Home shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Mid-America Apartment Communities pays an annual dividend of $6.06 per share and has a dividend yield of 4.6%. Invitation Home pays an annual dividend of $1.16 per share and has a dividend yield of 4.2%. Mid-America Apartment Communities pays out 128.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Invitation Home pays out 122.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Mid-America Apartment Communities has increased its dividend for 16 consecutive years and Invitation Home has increased its dividend for 1 consecutive years. Mid-America Apartment Communities is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Mid-America Apartment Communities has a beta of 0.78, meaning that its stock price is 22% less volatile than the S&P 500. Comparatively, Invitation Home has a beta of 0.81, meaning that its stock price is 19% less volatile than the S&P 500.

Profitability

This table compares Mid-America Apartment Communities and Invitation Home’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mid-America Apartment Communities	25.23%	9.10%	4.70%
Invitation Home	21.70%	6.03%	3.14%

Valuation and Earnings

This table compares Mid-America Apartment Communities and Invitation Home”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mid-America Apartment Communities	$2.20 billion	6.97	$527.54 million	$4.72	27.79
Invitation Home	$2.62 billion	6.54	$453.92 million	$0.95	29.42

Mid-America Apartment Communities has higher earnings, but lower revenue than Invitation Home. Mid-America Apartment Communities is trading at a lower price-to-earnings ratio than Invitation Home, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Mid-America Apartment Communities and Invitation Home, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mid-America Apartment Communities	2	11	8	0	2.29
Invitation Home	0	9	9	0	2.50

Mid-America Apartment Communities currently has a consensus price target of $156.22, suggesting a potential upside of 19.10%. Invitation Home has a consensus price target of $35.09, suggesting a potential upside of 25.56%. Given Invitation Home’s stronger consensus rating and higher probable upside, analysts clearly believe Invitation Home is more favorable than Mid-America Apartment Communities.

Summary

Mid-America Apartment Communities beats Invitation Home on 9 of the 17 factors compared between the two stocks.

About Mid-America Apartment Communities

Mid-America Apartment Communities, Inc. is a real estate investment trust, which engages in the operation, acquisition, and development of apartment communities. It operates through the Same Store and Non-Same Store segments. The Same Store Communities segment represents those apartment communities that have been owned and stabilized for at least 12 months as of the first day of the calendar year. The Non-Same Store segment includes recent acquisitions, communities in development or lease-up. The company was founded in 1994 and is headquartered in Germantown, TN.

About Invitation Home

Invitation Homes, an S&P 500 company, is the nation's premier single-family home leasing and management company, meeting changing lifestyle demands by providing access to high-quality, updated homes with valued features such as close proximity to jobs and access to good schools. The company's mission, Together with you, we make a house a home, reflects its commitment to providing homes where individuals and families can thrive and high-touch service that continuously enhances residents' living experiences.