Monogram Residential Trust (NYSE: MORE) and Preferred Apartment Communities (NASDAQ:APTS) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, dividends, analyst recommendations and risk.

Insider & Institutional Ownership

75.5% of Monogram Residential Trust shares are owned by institutional investors. 0.1% of Monogram Residential Trust shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations for Monogram Residential Trust and Preferred Apartment Communities, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Monogram Residential Trust 0 7 0 0 2.00
Preferred Apartment Communities 0 1 3 0 2.75

Monogram Residential Trust presently has a consensus target price of $11.75, suggesting a potential downside of 2.16%. Preferred Apartment Communities has a consensus target price of $17.63, suggesting a potential downside of 1.87%. Given Preferred Apartment Communities’ stronger consensus rating and higher probable upside, analysts clearly believe Preferred Apartment Communities is more favorable than Monogram Residential Trust.

Profitability

This table compares Monogram Residential Trust and Preferred Apartment Communities’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Monogram Residential Trust 37.63% 7.00% 3.42%
Preferred Apartment Communities 4.66% -4.73% 0.51%

Valuation & Earnings

This table compares Monogram Residential Trust and Preferred Apartment Communities’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Monogram Residential Trust $291.82 million 6.87 $144.44 million $0.65 18.48
Preferred Apartment Communities $249.98 million 2.39 $142.18 million N/A N/A

Monogram Residential Trust has higher revenue and earnings than Preferred Apartment Communities.

Dividends

Monogram Residential Trust pays an annual dividend of $0.30 per share and has a dividend yield of 2.5%. Preferred Apartment Communities does not pay a dividend. Monogram Residential Trust pays out 46.2% of its earnings in the form of a dividend.

Summary

Monogram Residential Trust beats Preferred Apartment Communities on 9 of the 13 factors compared between the two stocks.

Monogram Residential Trust Company Profile

Monogram Residential Trust, Inc. is a self-managed real estate investment trust (REIT). The Company invests in, develops and operates multifamily communities offering location and lifestyle amenities. The Company also invests in stabilized operating communities and communities in various phases of development, with a focus on communities in select markets across the United States. These include luxury high-rise, mid-rise and garden style multifamily communities. As of December 31, 2016, Monogram’s portfolio includes investments in 51 multifamily communities in 10 states comprising 14,473 residential units. As of September 30, 2016, the Company held ownership interests in equity investments, including 47 operating multifamily communities (including one development in lease up) containing 13,022 residential units in 10 states, all of which are consolidated for financial reporting purposes.

Preferred Apartment Communities Company Profile

Preferred Apartment Communities, Inc. is a real estate investment trust (REIT). The Company is formed to acquire and operate multifamily properties in select targeted markets throughout the United States. It operates through segments, including multifamily communities, real estate related financing, new market properties and office buildings. The multifamily communities segment consists of its portfolio of owned residential multifamily communities. The real estate related financing segment consists of the Company’s portfolio of real estate loans, bridge loans, and other instruments deployed by it to partially finance the development, construction, and prestabilization carrying costs of new multifamily communities and other real estate and real estate related assets. The new market properties segment consists of its portfolio of grocery-anchored shopping centers. The office buildings segment consists of its three office buildings located in Atlanta, Georgia and Birmingham, Alabama.

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