InvenTrust Properties (NYSE:IVT) vs. AvalonBay Communities (NYSE:AVB) Financial Analysis

InvenTrust Properties (NYSE:IVT) and AvalonBay Communities (NYSE:AVB) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, valuation, institutional ownership, analyst recommendations, profitability, risk and earnings.

Insider & Institutional Ownership

61.7% of InvenTrust Properties shares are held by institutional investors. Comparatively, 92.6% of AvalonBay Communities shares are held by institutional investors. 0.5% of InvenTrust Properties shares are held by insiders. Comparatively, 0.5% of AvalonBay Communities shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares InvenTrust Properties and AvalonBay Communities’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
InvenTrust Properties	4.99%	0.83%	0.54%
AvalonBay Communities	37.13%	9.15%	5.15%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for InvenTrust Properties and AvalonBay Communities, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
InvenTrust Properties	0	1	3	0	2.75
AvalonBay Communities	0	8	8	0	2.50

InvenTrust Properties currently has a consensus price target of $32.00, suggesting a potential upside of 7.44%. AvalonBay Communities has a consensus price target of $235.47, suggesting a potential upside of 8.31%. Given AvalonBay Communities’ higher possible upside, analysts plainly believe AvalonBay Communities is more favorable than InvenTrust Properties.

Earnings and Valuation

This table compares InvenTrust Properties and AvalonBay Communities”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
InvenTrust Properties	$273.97 million	8.42	$13.66 million	$0.18	165.46
AvalonBay Communities	$2.91 billion	10.61	$1.08 billion	$7.59	28.64

AvalonBay Communities has higher revenue and earnings than InvenTrust Properties. AvalonBay Communities is trading at a lower price-to-earnings ratio than InvenTrust Properties, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

InvenTrust Properties has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500. Comparatively, AvalonBay Communities has a beta of 0.99, suggesting that its share price is 1% less volatile than the S&P 500.

Dividends

InvenTrust Properties pays an annual dividend of $0.91 per share and has a dividend yield of 3.1%. AvalonBay Communities pays an annual dividend of $6.80 per share and has a dividend yield of 3.1%. InvenTrust Properties pays out 505.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. AvalonBay Communities pays out 89.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. AvalonBay Communities is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

AvalonBay Communities beats InvenTrust Properties on 14 of the 16 factors compared between the two stocks.

About InvenTrust Properties

InvenTrust Properties Corp. (the “Company,” “IVT,” or “InvenTrust”) is a premier Sun Belt, multi-tenant essential retail REIT that owns, leases, redevelops, acquires and manages grocery-anchored neighborhood and community centers as well as high-quality power centers that often have a grocery component. Management pursues the Company’s business strategy by acquiring retail properties in Sun Belt markets, opportunistically disposing of retail properties, maintaining a flexible capital structure, and enhancing environmental, social and governance (“ESG”) practices and standards. A trusted, local operator bringing real estate expertise to its tenant relationships, IVT has built a strong reputation with market participants across its portfolio. IVT is committed to leadership in ESG practices and has been a Global Real Estate Sustainability Benchmark (“GRESB”) member since 2013.

About AvalonBay Communities

AvalonBay Communities, Inc. is a real estate investment trust, which engages in the development, acquisition, ownership, and operation of multifamily communities. It operates through the following segments: Same Store, Other Stabilized, and Development or Redevelopment. The Same Store segment refers to the operating communities that were owned and had stabilized occupancy. The Other Stabilized segment includes all other complete communities that have stabilized occupancy. The Development or Redevelopment segment consists of communities that are under construction. The company was founded by Gilbert M. Meyer in 1978 and is headquartered in Arlington, VA.