Comparing AvalonBay Communities (NYSE:AVB) and InterRent Real Estate Investment Trust (OTCMKTS:IIPZF)

AvalonBay Communities (NYSE:AVBGet Free Report) and InterRent Real Estate Investment Trust (OTCMKTS:IIPZFGet Free Report) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, analyst recommendations, profitability and institutional ownership.

Insider & Institutional Ownership

92.6% of AvalonBay Communities shares are held by institutional investors. 0.4% of AvalonBay Communities shares are held by insiders. Comparatively, 6.8% of InterRent Real Estate Investment Trust shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and price targets for AvalonBay Communities and InterRent Real Estate Investment Trust, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AvalonBay Communities 0 8 8 0 2.50
InterRent Real Estate Investment Trust 0 0 0 0 N/A

AvalonBay Communities currently has a consensus target price of $197.03, indicating a potential upside of 6.18%. InterRent Real Estate Investment Trust has a consensus target price of $17.44, indicating a potential upside of 74.20%. Given InterRent Real Estate Investment Trust’s higher probable upside, analysts plainly believe InterRent Real Estate Investment Trust is more favorable than AvalonBay Communities.

Volatility and Risk

AvalonBay Communities has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500. Comparatively, InterRent Real Estate Investment Trust has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500.

Earnings and Valuation

This table compares AvalonBay Communities and InterRent Real Estate Investment Trust’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AvalonBay Communities $2.77 billion 9.52 $928.83 million $6.55 28.33
InterRent Real Estate Investment Trust $175.65 million 8.25 $68.32 million $0.47 21.30

AvalonBay Communities has higher revenue and earnings than InterRent Real Estate Investment Trust. InterRent Real Estate Investment Trust is trading at a lower price-to-earnings ratio than AvalonBay Communities, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares AvalonBay Communities and InterRent Real Estate Investment Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AvalonBay Communities 33.56% 7.98% 4.51%
InterRent Real Estate Investment Trust 38.61% 3.54% 2.07%

Dividends

AvalonBay Communities pays an annual dividend of $6.80 per share and has a dividend yield of 3.7%. InterRent Real Estate Investment Trust pays an annual dividend of $0.18 per share and has a dividend yield of 1.8%. AvalonBay Communities pays out 103.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. InterRent Real Estate Investment Trust pays out 38.3% of its earnings in the form of a dividend. AvalonBay Communities has increased its dividend for 2 consecutive years. AvalonBay Communities is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

AvalonBay Communities beats InterRent Real Estate Investment Trust on 12 of the 16 factors compared between the two stocks.

About AvalonBay Communities

(Get Free Report)

As of December 31, 2023, the Company owned or held a direct or indirect ownership interest in 299 apartment communities containing 90,669 apartment homes in 12 states and the District of Columbia, of which 18 communities were under development. The Company is an equity REIT in the business of developing, redeveloping, acquiring and managing apartment communities in leading metropolitan areas in New England, the New York/New Jersey Metro area, the Mid-Atlantic, the Pacific Northwest, and Northern and Southern California, as well as in the Company's expansion regions of Raleigh-Durham and Charlotte, North Carolina, Southeast Florida, Dallas and Austin, Texas, and Denver, Colorado.

About InterRent Real Estate Investment Trust

(Get Free Report)

InterRent?REIT is a growth-oriented real estate investment trust engaged in increasing Unitholder value and creating a growing and sustainable distribution?through the acquisition and ownership of multi-residential properties. InterRent's strategy is to expand its portfolio primarily within?markets that have exhibited stable market vacancies,?sufficient suites available to attain the critical mass necessary to implement?an efficient portfolio management structure, and?offer opportunities for accretive acquisitions. InterRent's primary objectives are to use the proven industry experience of the Trustees,?Management and Operational Team to: (i)?to grow both funds from operations per Unit and net asset value per Unit through investments in a diversified portfolio of multi-residential properties; (ii)?to provide Unitholders with sustainable and growing cash distributions, payable monthly; and (iii)?to maintain a conservative payout ratio and balance sheet.

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