Analyzing NexPoint Residential Trust (NXRT) and Its Competitors

NexPoint Residential Trust (NYSE:NXRT) is one of 57 public companies in the “Residential REITs” industry, but how does it compare to its rivals? We will compare NexPoint Residential Trust to similar companies based on the strength of its analyst recommendations, profitability, earnings, dividends, institutional ownership, valuation and risk.

Volatility and Risk

NexPoint Residential Trust has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500. Comparatively, NexPoint Residential Trust’s rivals have a beta of 0.68, indicating that their average share price is 32% less volatile than the S&P 500.

Valuation & Earnings

This table compares NexPoint Residential Trust and its rivals top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
NexPoint Residential Trust	$251.28 million	-$32.03 million	-11.08
NexPoint Residential Trust Competitors	$775.59 million	$238.42 million	37.62

NexPoint Residential Trust’s rivals have higher revenue and earnings than NexPoint Residential Trust. NexPoint Residential Trust is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Institutional & Insider Ownership

76.6% of NexPoint Residential Trust shares are owned by institutional investors. Comparatively, 55.8% of shares of all “Residential REITs” companies are owned by institutional investors. 16.6% of NexPoint Residential Trust shares are owned by insiders. Comparatively, 8.5% of shares of all “Residential REITs” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

NexPoint Residential Trust pays an annual dividend of $2.12 per share and has a dividend yield of 13.0%. NexPoint Residential Trust pays out -144.2% of its earnings in the form of a dividend. As a group, “Residential REITs” companies pay a dividend yield of 4.7% and pay out 175.7% of their earnings in the form of a dividend. NexPoint Residential Trust has increased its dividend for 3 consecutive years. NexPoint Residential Trust is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Analyst Ratings

This is a summary of current ratings and price targets for NexPoint Residential Trust and its rivals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NexPoint Residential Trust	3	3	0	0	1.50
NexPoint Residential Trust Competitors	623	3265	3379	147	2.41

NexPoint Residential Trust currently has a consensus target price of $20.50, indicating a potential upside of 25.87%. As a group, “Residential REITs” companies have a potential upside of 11.78%. Given NexPoint Residential Trust’s higher probable upside, research analysts clearly believe NexPoint Residential Trust is more favorable than its rivals.

Profitability

This table compares NexPoint Residential Trust and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NexPoint Residential Trust	-14.59%	-14.29%	-1.98%
NexPoint Residential Trust Competitors	11.22%	2.89%	2.58%

Summary

NexPoint Residential Trust rivals beat NexPoint Residential Trust on 9 of the 15 factors compared.

About NexPoint Residential Trust

NexPoint Residential Trust is a publicly traded REIT, with its shares listed on the New York Stock Exchange under the symbol “NXRT,” primarily focused on acquiring, owning and operating well-located middle-income multifamily properties with “value-add” potential in large cities and suburban submarkets of large cities, primarily in the Southeastern and Southwestern United States. NXRT is externally advised by NexPoint Real Estate Advisors, L.P., an affiliate of NexPoint Advisors, L.P., an SEC-registered investment advisor, which has extensive real estate experience.