Silver Bay Realty Trust Corp (NYSE:SBY) versus United Dominion Realty Trust (UDR) Critical Survey

Silver Bay Realty Trust Corp (NYSE: SBY) and United Dominion Realty Trust (NYSE:UDR) are both financials companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitabiliy, earnings, dividends and risk.

Institutional and Insider Ownership

73.6% of Silver Bay Realty Trust Corp shares are owned by institutional investors. Comparatively, 98.3% of United Dominion Realty Trust shares are owned by institutional investors. 7.3% of Silver Bay Realty Trust Corp shares are owned by company insiders. Comparatively, 3.1% of United Dominion Realty Trust shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Silver Bay Realty Trust Corp and United Dominion Realty Trust’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Silver Bay Realty Trust Corp N/A N/A N/A ($0.16) -134.31
United Dominion Realty Trust $979.22 million 10.60 $616.47 million $1.10 35.27

United Dominion Realty Trust has higher revenue and earnings than Silver Bay Realty Trust Corp. Silver Bay Realty Trust Corp is trading at a lower price-to-earnings ratio than United Dominion Realty Trust, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Silver Bay Realty Trust Corp has a beta of 0.67, indicating that its stock price is 33% less volatile than the S&P 500. Comparatively, United Dominion Realty Trust has a beta of 0.38, indicating that its stock price is 62% less volatile than the S&P 500.

Profitability

This table compares Silver Bay Realty Trust Corp and United Dominion Realty Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Silver Bay Realty Trust Corp -5.71% -1.42% -0.61%
United Dominion Realty Trust 30.74% 10.40% 3.97%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Silver Bay Realty Trust Corp and United Dominion Realty Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Silver Bay Realty Trust Corp 0 4 0 0 2.00
United Dominion Realty Trust 3 6 3 0 2.00

Silver Bay Realty Trust Corp currently has a consensus target price of $19.83, indicating a potential downside of 7.71%. United Dominion Realty Trust has a consensus target price of $38.25, indicating a potential downside of 1.42%. Given United Dominion Realty Trust’s higher possible upside, analysts plainly believe United Dominion Realty Trust is more favorable than Silver Bay Realty Trust Corp.

Dividends

Silver Bay Realty Trust Corp pays an annual dividend of $0.52 per share and has a dividend yield of 2.4%. United Dominion Realty Trust pays an annual dividend of $1.24 per share and has a dividend yield of 3.2%. Silver Bay Realty Trust Corp pays out -325.0% of its earnings in the form of a dividend. United Dominion Realty Trust pays out 112.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Silver Bay Realty Trust Corp has raised its dividend for 3 consecutive years and United Dominion Realty Trust has raised its dividend for 7 consecutive years. United Dominion Realty Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

United Dominion Realty Trust beats Silver Bay Realty Trust Corp on 10 of the 13 factors compared between the two stocks.

Silver Bay Realty Trust Corp 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.

United Dominion Realty Trust Company Profile

UDR, Inc. is a self-administered real estate investment trust. The Company owns, operates, acquires, renovates, develops, redevelops, disposes of and manages multifamily apartment communities generally located in various markets across the United States. The Company’s segments are Same-Store Communities and Non-Mature Communities/Other. As of December 31, 2016, the Company’s consolidated real estate portfolio included 127 communities located in 18 markets, with a total of 39,454 completed apartment homes. As of December 31, 2016, the Company also had an ownership interest in 27 communities containing 6,849 apartment homes through unconsolidated joint ventures or partnerships. As of December 31, 2016, the Company’s properties were in various locations, such as Orange County, San Francisco and Los Angeles in California; Seattle, Washington; Richmond, Virginia; Baltimore, Maryland; Orlando and Tampa in Florida; Nashville, Tennessee, and Dallas and Austin in Texas.

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