Silver Bay Realty Trust (NYSE: SBY) and Altisource Residential (NYSE:RESI) are both financials companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, risk, profitability, analyst recommendations and dividends.
Institutional & Insider Ownership
73.6% of Silver Bay Realty Trust shares are held by institutional investors. Comparatively, 70.5% of Altisource Residential shares are held by institutional investors. 7.3% of Silver Bay Realty Trust shares are held by insiders. Comparatively, 0.5% of Altisource Residential shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
This is a summary of current recommendations and price targets for Silver Bay Realty Trust and Altisource Residential, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Silver Bay Realty Trust||0||3||0||0||2.00|
Silver Bay Realty Trust currently has a consensus target price of $20.25, suggesting a potential downside of 5.77%. Altisource Residential has a consensus target price of $15.67, suggesting a potential upside of 37.19%. Given Altisource Residential’s stronger consensus rating and higher probable upside, analysts clearly believe Altisource Residential is more favorable than Silver Bay Realty Trust.
Valuation and Earnings
This table compares Silver Bay Realty Trust and Altisource Residential’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Silver Bay Realty Trust||N/A||N/A||N/A||($0.07)||-307.00|
|Altisource Residential||$56.76 million||10.75||-$228.02 million||($3.90)||-2.93|
Silver Bay Realty Trust has higher earnings, but lower revenue than Altisource Residential. Silver Bay Realty Trust is trading at a lower price-to-earnings ratio than Altisource Residential, indicating that it is currently the more affordable of the two stocks.
Silver Bay Realty Trust pays an annual dividend of $0.52 per share and has a dividend yield of 2.4%. Altisource Residential pays an annual dividend of $0.60 per share and has a dividend yield of 5.3%. Silver Bay Realty Trust pays out -742.9% of its earnings in the form of a dividend. Altisource Residential pays out -15.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Silver Bay Realty Trust has raised its dividend for 4 consecutive years and Altisource Residential has raised its dividend for 4 consecutive years.
This table compares Silver Bay Realty Trust and Altisource Residential’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Silver Bay Realty Trust||-5.71%||-1.42%||-0.61%|
Silver Bay Realty Trust beats Altisource Residential on 7 of the 13 factors compared between the two stocks.
Silver Bay Realty Trust Company Profile
Silver Bay Realty Trust Corp. is a real estate investment trust. It focuses on the acquisition, renovation, leasing and management of single-family properties in select markets in the United States. As of December 31, 2016, it had owned 9,044 single-family properties in Arizona, California, Florida, Georgia, Nevada, North Carolina, Ohio, South Carolina and Texas. Its investments in real estate consist of single-family properties located in various select markets, including Atlanta, Phoenix, Tampa, Charlotte, Orlando, Dallas, Jacksonville, Northern California, Las Vegas, Columbus, Tucson and Southeast Florida. The Charlotte market includes properties in South Carolina due to its proximity to Charlotte, North Carolina. The Northern California market consists of Contra Costa, Napa and Solano counties. The Southeast Florida market consists of Miami-Dade, Broward and Palm Beach counties. It conducts business and owns all of its properties through Silver Bay Operating Partnership L.P.
Altisource Residential Company Profile
Altisource Residential Corporation is a real estate investment trust (REIT). The Company focuses on acquiring, owning and managing single-family rental (SFR) properties throughout the United States. The Company conducts its activities through its subsidiary, Altisource Residential, L.P., and its subsidiaries. The Company also converts a portion of the real estate owned (REO) properties that it acquires through resolution of its mortgage loans into SFR properties. The Company has also entered into property management service agreements with two third-party property managers: Altisource Portfolio Solutions, SA (ASPS) and Main Street Renewal, LLC (MSR), to provide, among other things, leasing and lease management, operations, maintenance, repair and property management services in respect of its SFR portfolios. As of December 31, 2016, the Company had 10,533 properties, consisting of 9,939 properties held for use and 594 held for sale.
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