Critical Review: Equity Lifestyle Properties (NYSE:ELS) vs. United Dominion Realty Trust (NYSE:UDR)

United Dominion Realty Trust (NYSE:UDR) and Equity Lifestyle Properties (NYSE:ELS) are both large-cap real estate companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, profitability, risk, analyst recommendations, dividends, earnings and institutional ownership.

Volatility and Risk

United Dominion Realty Trust has a beta of 0.72, meaning that its stock price is 28% less volatile than the S&P 500. Comparatively, Equity Lifestyle Properties has a beta of 0.63, meaning that its stock price is 37% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for United Dominion Realty Trust and Equity Lifestyle Properties, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Dominion Realty Trust	2	9	5	1	2.29
Equity Lifestyle Properties	2	6	6	1	2.40

United Dominion Realty Trust presently has a consensus target price of $40.03, indicating a potential upside of 12.67%. Equity Lifestyle Properties has a consensus target price of $67.09, indicating a potential upside of 13.63%. Given Equity Lifestyle Properties’ stronger consensus rating and higher possible upside, analysts clearly believe Equity Lifestyle Properties is more favorable than United Dominion Realty Trust.

Dividends

United Dominion Realty Trust pays an annual dividend of $1.74 per share and has a dividend yield of 4.9%. Equity Lifestyle Properties pays an annual dividend of $2.17 per share and has a dividend yield of 3.7%. United Dominion Realty Trust pays out 110.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Equity Lifestyle Properties pays out 106.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. United Dominion Realty Trust has raised its dividend for 15 consecutive years and Equity Lifestyle Properties has raised its dividend for 21 consecutive years.

Institutional and Insider Ownership

97.8% of United Dominion Realty Trust shares are held by institutional investors. Comparatively, 97.2% of Equity Lifestyle Properties shares are held by institutional investors. 1.8% of United Dominion Realty Trust shares are held by company insiders. Comparatively, 0.8% of Equity Lifestyle Properties shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares United Dominion Realty Trust and Equity Lifestyle Properties”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Dominion Realty Trust	$1.72 billion	6.65	$377.70 million	$1.57	22.63
Equity Lifestyle Properties	$1.53 billion	7.51	$386.51 million	$2.03	29.08

Equity Lifestyle Properties has lower revenue, but higher earnings than United Dominion Realty Trust. United Dominion Realty Trust is trading at a lower price-to-earnings ratio than Equity Lifestyle Properties, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares United Dominion Realty Trust and Equity Lifestyle Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Dominion Realty Trust	30.43%	16.56%	5.00%
Equity Lifestyle Properties	24.97%	21.73%	6.84%

Summary

Equity Lifestyle Properties beats United Dominion Realty Trust on 11 of the 17 factors compared between the two stocks.

About United Dominion Realty Trust

UDR, Inc. (NYSE: UDR), an S&P 500 company, is a leading multifamily real estate investment trust with a demonstrated performance history of delivering superior and dependable returns by successfully managing, buying, selling, developing and redeveloping attractive real estate communities in targeted U.S. markets. As of December 31, 2023, UDR owned or had an ownership position in 60,336 apartment homes including 359 homes under development. For over 51 years, UDR has delivered long-term value to shareholders, the best standard of service to Residents and the highest quality experience for Associates.

About Equity Lifestyle Properties

Equity LifeStyle Properties, Inc. is a real estate investment trust, which engages in the ownership and operation of lifestyle-oriented properties consisting primarily of manufactured home, and recreational vehicle communities. It operates through the following segments: Property Operations and Home Sales and Rentals Operations. The Property Operations segment owns and operates land lease properties. The Home Sales and Rentals Operations segment purchases, sells, and leases homes. The company was founded by James M. Hankins in December 1992 and is headquartered in Chicago, IL.