New Senior Investment Group (NYSE: SNR) and Mid-America Apartment Communities (NYSE:MAA) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, valuation, institutional ownership, risk and dividends.

Volatility and Risk

New Senior Investment Group has a beta of 0.93, suggesting that its share price is 7% less volatile than the S&P 500. Comparatively, Mid-America Apartment Communities has a beta of 0.35, suggesting that its share price is 65% less volatile than the S&P 500.

Dividends

New Senior Investment Group pays an annual dividend of $1.04 per share and has a dividend yield of 12.6%. Mid-America Apartment Communities pays an annual dividend of $3.48 per share and has a dividend yield of 3.4%. New Senior Investment Group pays out -358.6% of its earnings in the form of a dividend. Mid-America Apartment Communities pays out 156.8% 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 6 consecutive years. New Senior Investment Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares New Senior Investment Group and Mid-America Apartment Communities’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
New Senior Investment Group -5.25% -4.49% -0.87%
Mid-America Apartment Communities 16.73% 4.22% 2.40%

Valuation and Earnings

This table compares New Senior Investment Group and Mid-America Apartment Communities’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
New Senior Investment Group $472.44 million 1.43 -$72.24 million ($0.29) -28.38
Mid-America Apartment Communities $1.13 billion 10.38 $212.22 million $2.22 46.32

Mid-America Apartment Communities has higher revenue and earnings than New Senior Investment Group. New Senior Investment Group is trading at a lower price-to-earnings ratio than Mid-America Apartment Communities, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

67.4% of New Senior Investment Group shares are held by institutional investors. Comparatively, 93.1% of Mid-America Apartment Communities shares are held by institutional investors. 1.0% of New Senior Investment Group shares are held by insiders. Comparatively, 1.3% of Mid-America Apartment Communities shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations and price targets for New Senior Investment Group and Mid-America Apartment Communities, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
New Senior Investment Group 1 2 1 0 2.00
Mid-America Apartment Communities 0 5 7 0 2.58

New Senior Investment Group presently has a consensus target price of $9.67, suggesting a potential upside of 17.46%. Mid-America Apartment Communities has a consensus target price of $110.80, suggesting a potential upside of 7.74%. Given New Senior Investment Group’s higher probable upside, analysts clearly believe New Senior Investment Group is more favorable than Mid-America Apartment Communities.

Summary

Mid-America Apartment Communities beats New Senior Investment Group on 13 of the 17 factors compared between the two stocks.

New Senior Investment Group Company Profile

New Senior Investment Group Inc. is a real estate investment trust with a diversified portfolio of primarily private pay senior housing properties located across the United States. The Company operates through two segments: Managed Properties and Triple Net Lease Properties. As of December 31, 2016, the Company owned a diversified portfolio of 152 primarily private pay senior housing properties located across 37 states. Under its Managed Properties segment, the Company invests in senior housing properties throughout the United States and engages property managers to manage those senior housing properties. As of December 31, 2016, the Company owned 94 properties under property management agreements with the property managers. Under its Triple Net Lease Properties segment, the Company invests in senior housing and healthcare properties throughout the United States, and leases those properties to healthcare operating companies under triple net leases.

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.

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