Howard Hughes (NYSE:HHC – Get Rating) and Apartment Income REIT (NYSE:AIRC – Get Rating) are both mid-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, profitability, institutional ownership, risk, analyst recommendations, earnings and valuation.
Analyst Recommendations
This is a breakdown of current ratings for Howard Hughes and Apartment Income REIT, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Howard Hughes | 0 | 0 | 4 | 0 | 3.00 |
| Apartment Income REIT | 0 | 3 | 4 | 0 | 2.57 |
Howard Hughes presently has a consensus target price of $86.67, indicating a potential upside of 14.68%. Apartment Income REIT has a consensus target price of $42.33, indicating a potential upside of 20.09%. Given Apartment Income REIT’s higher possible upside, analysts clearly believe Apartment Income REIT is more favorable than Howard Hughes.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| Howard Hughes | 10.01% | 4.50% | 1.67% |
| Apartment Income REIT | 64.27% | 22.90% | 7.87% |
Earnings & Valuation
This table compares Howard Hughes and Apartment Income REIT’s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Howard Hughes | $1.61 billion | 2.35 | $184.53 million | $3.22 | 23.47 |
| Apartment Income REIT | $773.72 million | 6.80 | $904.43 million | $3.36 | 10.49 |
Apartment Income REIT has lower revenue, but higher earnings than Howard Hughes. Apartment Income REIT is trading at a lower price-to-earnings ratio than Howard Hughes, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
99.4% of Apartment Income REIT shares are held by institutional investors. 33.0% of Howard Hughes shares are held by insiders. Comparatively, 0.9% of Apartment Income REIT shares are held by 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.
Volatility & Risk
Howard Hughes has a beta of 1.46, indicating that its stock price is 46% more volatile than the S&P 500. Comparatively, Apartment Income REIT has a beta of 0.9, indicating that its stock price is 10% less volatile than the S&P 500.
Summary
Apartment Income REIT beats Howard Hughes on 8 of the 13 factors compared between the two stocks.
About Howard Hughes
The Howard Hughes Corp. engages in the development and management of commercial, residential, and mixed-use real estate. It operates through the following segments: Operating Assets, Master Planned Communities, Seaport District, and Strategic Developments. The Operating Assets segment consists of retail, office, hospitality, and multi-family properties along with other real estate investments. The Master Planned Communities segment focuses on the development and sale of land in large-scale, long-term community development projects in and around Las Vegas, Nevada, Houston, Texas, and Columbia, Maryland. The Seaport District operates approximately 453,000 square feet of restaurant, retail, and entertainment properties situated in three primary locations in New York, New York: Pier 17, Historic Area/Uplands, and Tin Building. The Strategic Developments segment is involved in other real estate assets in the form of entitled and unentitled land and residential condominium developments. The company was founded in July 2010 and is headquartered in Woodlands, TX.
About Apartment Income REIT
AIR is a real estate investment trust focused on the ownership and management of quality apartment communities located in the largest markets in the United States. AIR is one of the country's largest owners and operators of apartments, with 99 communities in 12 states and the District of Columbia. AIR common shares are traded on the New York Stock Exchange under the ticker symbol AIRC, and are included in the S&P 400. For more information about AIR, please visit our website at www.aircommunities.com.
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