Colony Starwood Homes (NYSE: SFR) and Independence Realty Trust (NYSE:IRT) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their institutional ownership, earnings, profitability, analyst recommendations, dividends, valuation and risk.
This table compares Colony Starwood Homes and Independence Realty Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Colony Starwood Homes||-5.65%||-0.81%||-0.34%|
|Independence Realty Trust||-10.28%||-3.22%||-1.22%|
This is a summary of recent ratings for Colony Starwood Homes and Independence Realty Trust, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Colony Starwood Homes||0||5||6||0||2.55|
|Independence Realty Trust||0||0||5||0||3.00|
Colony Starwood Homes presently has a consensus target price of $36.73, indicating a potential upside of 2.39%. Independence Realty Trust has a consensus target price of $10.60, indicating a potential upside of 2.22%. Given Colony Starwood Homes’ higher possible upside, equities analysts plainly believe Colony Starwood Homes is more favorable than Independence Realty Trust.
Colony Starwood Homes pays an annual dividend of $0.88 per share and has a dividend yield of 2.5%. Independence Realty Trust pays an annual dividend of $0.72 per share and has a dividend yield of 6.9%. Colony Starwood Homes pays out -266.7% of its earnings in the form of a dividend. Independence Realty Trust pays out -313.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Independence Realty Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.
Volatility and Risk
Colony Starwood Homes has a beta of 0.9, meaning that its share price is 10% less volatile than the S&P 500. Comparatively, Independence Realty Trust has a beta of 1.07, meaning that its share price is 7% more volatile than the S&P 500.
Earnings and Valuation
This table compares Colony Starwood Homes and Independence Realty Trust’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Colony Starwood Homes||$599.75 million||6.07||$315.66 million||($0.33)||-108.70|
|Independence Realty Trust||N/A||N/A||N/A||($0.23)||-45.08|
Colony Starwood Homes has higher revenue and earnings than Independence Realty Trust. Colony Starwood Homes is trading at a lower price-to-earnings ratio than Independence Realty Trust, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
61.9% of Independence Realty Trust shares are owned by institutional investors. 5.0% of Colony Starwood Homes shares are owned by company insiders. Comparatively, 0.6% of Independence Realty Trust shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Colony Starwood Homes beats Independence Realty Trust on 8 of the 14 factors compared between the two stocks.
About Colony Starwood Homes
Starwood Waypoint Homes, formerly Colony Starwood Homes, is an internally managed real estate investment trust (REIT). The Company was formed primarily to acquire, renovate, lease and manage residential assets in select markets across the United States. It is focused on acquiring single-family rental (SFR) homes through a variety of channels, renovating these homes to the extent necessary and leasing them to qualified residents. The Company operates through two segments, which are represented by its portfolio of SFR homes and its portfolio of NPLs owned in the joint venture with Prime Asset Fund VI, LLC (Prime). The Company identifies and pursues individual home acquisition opportunities through various sources, including multiple listing services (MLS) listings, foreclosure auctions and short sales. As of December 31, 2016, its SFR portfolio consisted of 31,684 owned homes, including 31,065 rental homes and 619 homes that it does not intend to hold for the long term.
About Independence Realty Trust
Independence Realty Trust, Inc. is an internally-managed real estate investment trust (REIT). The Company is engaged in the business of owning, managing, operating, leasing, acquiring, developing, investing in, and disposing of real estate assets. The Company owns apartment properties in geographic non-gateway markets. As of September 26, 2017, the Company owns and operates 55 multifamily apartment properties, totaling 15,165 units. Its properties include Copper Mill, Crestmont, Heritage Trace, Runaway Bay, Berkshire Square, The Crossings, Reserve at Eagle Ridge, Windrush, Heritage Park, Raindance, Augusta, Invitational, Carrington Park, Walnut Hill, Lenoxplace, Bennington Pond, Jamestown, Meadows, Oxmoor, Bayview Club, Arbors River Oaks, Fox Trails, Bridge Pointe, The Aventine Greenville and Westmont Commons.
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