Camden Property Trust (CPT) and American Residential Properties (ARPI) Financial Analysis

Camden Property Trust (NYSE: CPT) and American Residential Properties (NYSE:ARPI) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, analyst recommendations, institutional ownership, profitability, risk, earnings and dividends.

Profitability

This table compares Camden Property Trust and American Residential Properties’ 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%
American Residential Properties -38.70% -9.17% -3.64%

Insider & Institutional Ownership

97.0% of Camden Property Trust shares are owned by institutional investors. 4.7% of Camden Property Trust shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and price targets for Camden Property Trust and American Residential Properties, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Camden Property Trust 0 5 9 0 2.64
American Residential Properties 0 0 0 0 N/A

Camden Property Trust currently has a consensus target price of $94.21, suggesting a potential upside of 11.09%.

Dividends

Camden Property Trust pays an annual dividend of $3.00 per share and has a dividend yield of 3.5%. American Residential Properties pays an annual dividend of $0.40 per share. 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. American Residential Properties pays out -28.6% of its earnings in the form of a dividend. Camden Property Trust has raised its dividend for 7 consecutive years. Camden Property Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Camden Property Trust and American Residential Properties’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Camden Property Trust $876.45 million 8.97 $819.82 million $1.64 51.71
American Residential Properties N/A N/A N/A ($1.40) N/A

Camden Property Trust has higher revenue and earnings than American Residential Properties. American Residential Properties 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.

Summary

Camden Property Trust beats American Residential Properties on 11 of the 12 factors compared between the two stocks.

Camden Property Trust Company Profile

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.

American Residential Properties Company Profile

American Residential Properties, Inc. is an internally managed real estate investment company, which is organized as a real estate investment trust. The Company acquires, owns, renovates, and manages single-family homes as rental properties. American Residential Properties OP, L.P. acts as its operating partnership. American Residential Leasing Company, LLC is a wholly owned subsidiary of its operating partnership. The Company owns 8,893 properties in Arizona, California, Colorado, Florida, Georgia, Illinois, Indiana, Nevada, North Carolina, Ohio, South Carolina, Tennessee and Texas that were 81% leased, and it managed an additional 437 properties for ARP Phoenix Fund I, LP in Arizona and Nevada. In addition to its primary business, the Company has a private mortgage financing business.

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