Mid-America Apartment Communities (MAA) and American Campus Communities (ACC) Critical Analysis
Mid-America Apartment Communities (NYSE: MAA) and American Campus Communities (NYSE:ACC) are both mid-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, earnings, profitability, dividends and analyst recommendations.
This is a breakdown of recent ratings and price targets for Mid-America Apartment Communities and American Campus Communities, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Mid-America Apartment Communities||0||1||8||0||2.89|
|American Campus Communities||0||4||5||0||2.56|
Mid-America Apartment Communities currently has a consensus target price of $108.13, indicating a potential upside of 0.63%. American Campus Communities has a consensus target price of $52.50, indicating a potential upside of 9.99%. Given American Campus Communities’ higher probable upside, analysts clearly believe American Campus Communities is more favorable than Mid-America Apartment Communities.
Insider & Institutional Ownership
92.4% of Mid-America Apartment Communities shares are owned by institutional investors. Comparatively, 99.8% of American Campus Communities shares are owned by institutional investors. 1.3% of Mid-America Apartment Communities shares are owned by insiders. Comparatively, 0.7% of American Campus Communities shares 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.
Valuation & Earnings
This table compares Mid-America Apartment Communities and American Campus Communities’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Mid-America Apartment Communities||$1.35 billion||9.04||$761.51 million||$2.34||45.92|
|American Campus Communities||$772.33 million||8.43||$379.78 million||$0.49||97.41|
Mid-America Apartment Communities has higher revenue and earnings than American Campus Communities. Mid-America Apartment Communities is trading at a lower price-to-earnings ratio than American Campus Communities, indicating that it is currently the more affordable of the two stocks.
This table compares Mid-America Apartment Communities and American Campus Communities’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Mid-America Apartment Communities||15.80%||4.31%||2.38%|
|American Campus Communities||8.59%||1.90%||1.09%|
Mid-America Apartment Communities pays an annual dividend of $3.48 per share and has a dividend yield of 3.2%. American Campus Communities pays an annual dividend of $1.76 per share and has a dividend yield of 3.7%. Mid-America Apartment Communities pays out 148.7% 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 Campus Communities pays out 359.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Mid-America Apartment Communities has increased its dividend for 4 consecutive years and American Campus Communities has increased its dividend for 6 consecutive years. American Campus Communities is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Risk and Volatility
Mid-America Apartment Communities has a beta of 0.35, meaning that its stock price is 65% less volatile than the S&P 500. Comparatively, American Campus Communities has a beta of 0.25, meaning that its stock price is 75% less volatile than the S&P 500.
Mid-America Apartment Communities beats American Campus Communities on 12 of the 17 factors compared between the two stocks.
Mid-America Apartment Communities Company Profile
Mid-America Apartment Communities, Inc. is a multifamily focused, self-administered and self-managed real estate investment trust (REIT). The Company owns, operates, acquires and develops apartment communities primarily located in the Southeast and Southwest regions of the United States. It operates through three segments: Large market same store, Secondary market same store and Non-Same Store and Other. Its Large market same store communities are communities in markets with a population of at least one million and at least 1% of the total public multifamily REIT units that it has owned. Its Secondary market same store communities are communities in markets with populations of more than one million but less than 1% of the total public multifamily REIT units or markets with populations of less than one million that it has owned. Its Non-same store communities and other includes recent acquisitions and communities in development or lease-up communities.
American Campus Communities Company Profile
American Campus Communities, Inc. is a self-managed and self-administered equity real estate investment trust (REIT). The Company’s segments include Wholly-Owned Properties, On-Campus Participating Properties, Development Services, and Property Management Services. It is engaged in the acquisition, design, financing, development, construction management, leasing and management of student housing properties. The Wholly-Owned Properties segment consists of off-campus properties, which are located in close proximity to the school campus. The On-Campus Participating Properties segment includes on-campus properties that are operated under long-term ground/facility leases with three university systems. The Development Services segment consists of development and construction management services that it provides through one of its taxable REIT subsidiaries for third-party owners. The Property Management Services segment includes revenues generated from third-party management contracts.
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