Critical Review: Arbor Realty Trust (ABR) and Its Peers

Arbor Realty Trust (NYSE:ABR) is one of 52 public companies in the “Mortgage Real Estate Investment Trusts (REITs)” industry, but how does it contrast to its rivals? We will compare Arbor Realty Trust to related businesses based on the strength of its valuation, risk, analyst recommendations, profitability, dividends, earnings and institutional ownership.

Insider & Institutional Ownership

57.3% of Arbor Realty Trust shares are owned by institutional investors. Comparatively, 52.3% of shares of all “Mortgage Real Estate Investment Trusts (REITs)” companies are owned by institutional investors. 4.2% of Arbor Realty Trust shares are owned by insiders. Comparatively, 4.8% of shares of all “Mortgage Real Estate Investment Trusts (REITs)” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Risk and Volatility

Arbor Realty Trust has a beta of 1.28, meaning that its stock price is 28% more volatile than the S&P 500. Comparatively, Arbor Realty Trust’s rivals have a beta of 1.21, meaning that their average stock price is 21% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for Arbor Realty Trust and its rivals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arbor Realty Trust	4	2	0	0	1.33
Arbor Realty Trust Competitors	691	1990	2138	136	2.35

Arbor Realty Trust currently has a consensus target price of $5.12, suggesting a potential upside of 289.73%. As a group, “Mortgage Real Estate Investment Trusts (REITs)” companies have a potential upside of 51.88%. Given Arbor Realty Trust’s higher probable upside, analysts plainly believe Arbor Realty Trust is more favorable than its rivals.

Profitability

This table compares Arbor Realty Trust and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arbor Realty Trust	-7.96%	3.98%	0.62%
Arbor Realty Trust Competitors	-13.31%	7.65%	1.05%

Dividends

Arbor Realty Trust pays an annual dividend of $0.68 per share and has a dividend yield of 51.7%. Arbor Realty Trust pays out -106.2% of its earnings in the form of a dividend. As a group, “Mortgage Real Estate Investment Trusts (REITs)” companies pay a dividend yield of 17.6% and pay out -104.4% of their earnings in the form of a dividend. Arbor Realty Trust is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares Arbor Realty Trust and its rivals gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Arbor Realty Trust	$940.01 million	$148.80 million	-2.05
Arbor Realty Trust Competitors	$600.77 million	$157.00 million	18.70

Arbor Realty Trust has higher revenue, but lower earnings than its rivals. Arbor Realty Trust is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Summary

Arbor Realty Trust rivals beat Arbor Realty Trust on 8 of the 15 factors compared.

About Arbor Realty Trust

Arbor Realty Trust, Inc. is a real estate investment trust focused primarily on financing multifamily and other commercial real estate. Through its structured finance business, the company provides loans and other capital solutions, including bridge and mezzanine loans and preferred equity investments. The company also operates an agency lending business that arranges financing for multifamily properties through programs sponsored by government-backed housing agencies. Its activities include originating and servicing loans, as well as investing in commercial real estate-related assets.