Monogram Residential Trust (NYSE: MORE) and American Campus Communities (NYSE:ACC) are both mid-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, earnings, valuation, institutional ownership, profitability, risk and analyst recommendations.

Dividends

Monogram Residential Trust pays an annual dividend of $0.30 per share and has a dividend yield of 2.5%. American Campus Communities pays an annual dividend of $1.76 per share and has a dividend yield of 3.7%. Monogram Residential Trust pays out 46.2% of its earnings in the form of a dividend. 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. Monogram Residential Trust has increased its dividend for 4 consecutive years.

Institutional and Insider Ownership

75.4% of Monogram Residential Trust shares are held by institutional investors. 0.1% of Monogram Residential Trust shares are held by insiders. Comparatively, 0.7% of American Campus Communities shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Monogram Residential Trust and American Campus 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%
American Campus Communities 8.59% 1.90% 1.09%

Earnings and Valuation

This table compares Monogram Residential Trust and American Campus Communities’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Monogram Residential Trust $291.82 million 6.86 $144.44 million $0.65 18.45
American Campus Communities $772.33 million 8.36 $379.78 million $0.49 96.57

American Campus Communities has higher revenue and earnings than Monogram Residential Trust. Monogram Residential Trust 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.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Monogram Residential Trust and American Campus Communities, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Monogram Residential Trust 0 7 0 0 2.00
American Campus Communities 0 4 6 0 2.60

Monogram Residential Trust currently has a consensus price target of $11.75, indicating a potential downside of 2.00%. American Campus Communities has a consensus price target of $53.00, indicating a potential upside of 12.00%. Given American Campus Communities’ stronger consensus rating and higher possible upside, analysts plainly believe American Campus Communities is more favorable than Monogram Residential Trust.

Volatility & Risk

Monogram Residential Trust has a beta of 0.8, suggesting that its stock price is 20% less volatile than the S&P 500. Comparatively, American Campus Communities has a beta of 0.25, suggesting that its stock price is 75% less volatile than the S&P 500.

Summary

American Campus Communities beats Monogram Residential Trust on 9 of the 17 factors compared between the two stocks.

About Monogram Residential Trust

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.

About American Campus Communities

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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