Service Properties Trust (NASDAQ:SVC – Get Free Report) and American Homes 4 Rent (NYSE:AMH – Get Free Report) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, earnings, valuation, risk and dividends.
Valuation & Earnings
This table compares Service Properties Trust and American Homes 4 Rent”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Service Properties Trust | $1.90 billion | 0.25 | -$32.78 million | ($1.67) | -1.74 |
| American Homes 4 Rent | $1.73 billion | 7.89 | $412.43 million | $1.08 | 34.12 |
American Homes 4 Rent has lower revenue, but higher earnings than Service Properties Trust. Service Properties Trust is trading at a lower price-to-earnings ratio than American Homes 4 Rent, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Profitability
This table compares Service Properties Trust and American Homes 4 Rent’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Service Properties Trust | -12.87% | -22.67% | -3.37% |
| American Homes 4 Rent | 23.86% | 5.33% | 3.15% |
Dividends
Service Properties Trust pays an annual dividend of $0.04 per share and has a dividend yield of 1.4%. American Homes 4 Rent pays an annual dividend of $1.20 per share and has a dividend yield of 3.3%. Service Properties Trust pays out -2.4% of its earnings in the form of a dividend. American Homes 4 Rent pays out 111.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Institutional and Insider Ownership
77.6% of Service Properties Trust shares are held by institutional investors. Comparatively, 91.9% of American Homes 4 Rent shares are held by institutional investors. 1.4% of Service Properties Trust shares are held by insiders. Comparatively, 6.3% of American Homes 4 Rent 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 Recommendations
This is a breakdown of recent ratings and target prices for Service Properties Trust and American Homes 4 Rent, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Service Properties Trust | 1 | 0 | 1 | 0 | 2.00 |
| American Homes 4 Rent | 0 | 6 | 9 | 0 | 2.60 |
Service Properties Trust currently has a consensus target price of $5.25, indicating a potential upside of 81.03%. American Homes 4 Rent has a consensus target price of $40.47, indicating a potential upside of 9.80%. Given Service Properties Trust’s higher probable upside, research analysts plainly believe Service Properties Trust is more favorable than American Homes 4 Rent.
Summary
American Homes 4 Rent beats Service Properties Trust on 12 of the 16 factors compared between the two stocks.
About Service Properties Trust
Service Properties Trust (Nasdaq: SVC) is a real estate investment trust with over $11 billion invested in two asset categories: hotels and service-focused retail net lease properties. As of December 31, 2023, SVC owned 221 hotels with over 37,000 guest rooms throughout the United States and in Puerto Rico and Canada, the majority of which are extended stay and select service. As of December 31, 2023, SVC also owned 752 service-focused retail net lease properties totaling approximately 13.3 million square feet throughout the United States. SVC is managed by The RMR Group (Nasdaq: RMR), a leading U.S. alternative asset management company with over $41 billion in assets under management as of December 31, 2023, and more than 35 years of institutional experience in buying, selling, financing and operating commercial real estate. SVC is headquartered in Newton, MA.
About American Homes 4 Rent
American Homes 4 Rent operates as a real estate investment trust. It engages in the acquisition, renovation, leasing, and operating of single-family homes as rental properties. The company was founded by Bradley Wayne Hughes, Sr. on October 19, 2012 and is headquartered in Las Vegas, NV.
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