DB:A4XA

Stock Analysis Report

American Homes 4 Rent

Executive Summary

American Homes 4 Rent (NYSE: AMH) is a leader in the single-family home rental industry and "American Homes 4 Rent" is fast becoming a nationally recognized brand for rental homes, known for high-quality, good value and tenant satisfaction.

Rewards

Trading at 16.5% below its fair value

Earnings are forecast to grow 16.48% per year

Became profitable this year

Risk Analysis

Large one-off items impacting financial results

Shareholders have been diluted in the past year



Snowflake Analysis

Moderate growth potential and slightly overvalued.

Share Price & News

How has American Homes 4 Rent's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: A4XA has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.2%

A4XA

1.3%

DE REITs

0.7%

DE Market


1 Year Return

28.8%

A4XA

34.5%

DE REITs

15.6%

DE Market

Return vs Industry: A4XA underperformed the German REITs industry which returned 32.9% over the past year.

Return vs Market: A4XA exceeded the German Market which returned 17.1% over the past year.


Shareholder returns

A4XAIndustryMarket
7 Day2.2%1.3%0.7%
30 Day5.4%5.0%1.7%
90 Day3.0%5.6%6.3%
1 Year29.9%28.8%39.1%34.5%19.2%15.6%
3 Year27.0%23.5%40.4%20.5%18.3%7.9%
5 Year66.7%58.4%43.9%13.0%26.8%9.4%

Price Volatility Vs. Market

How volatile is American Homes 4 Rent's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is American Homes 4 Rent undervalued compared to its fair value and its price relative to the market?

15.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: A4XA (€23.61) is trading below our estimate of fair value (€28.26)

Significantly Below Fair Value: A4XA is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: A4XA is poor value based on its PE Ratio (99.5x) compared to the REITs industry average (8.9x).

PE vs Market: A4XA is poor value based on its PE Ratio (99.5x) compared to the German market (20.6x).


Price to Earnings Growth Ratio

PEG Ratio: A4XA is poor value based on its PEG Ratio (6x)


Price to Book Ratio

PB vs Industry: A4XA is good value based on its PB Ratio (1.5x) compared to the DE REITs industry average (1.6x).


Next Steps

Future Growth

How is American Homes 4 Rent forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

16.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: A4XA's forecast earnings growth (16.5% per year) is above the savings rate (-0.4%).

Earnings vs Market: A4XA's earnings (16.5% per year) are forecast to grow faster than the German market (13.2% per year).

High Growth Earnings: A4XA's earnings are forecast to grow, but not significantly.

Revenue vs Market: A4XA's revenue (5.5% per year) is forecast to grow faster than the German market (4.8% per year).

High Growth Revenue: A4XA's revenue (5.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: A4XA's Return on Equity is forecast to be low in 3 years time (1.2%).


Next Steps

Past Performance

How has American Homes 4 Rent performed over the past 5 years?

57.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: A4XA has a large one-off gain of $33.6M impacting its September 30 2019 financial results.

Growing Profit Margin: A4XA became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: A4XA has become profitable over the past 5 years, growing earnings by 57.7% per year.

Accelerating Growth: A4XA has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: A4XA has become profitable in the last year, making it difficult to compare its past year earnings growth to the REITs industry (96.7%).


Return on Equity

High ROE: A4XA's Return on Equity (2.5%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is American Homes 4 Rent's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: A4XA has a high level of physical assets or inventory.

Debt Coverage by Assets: A4XA's debt is not covered by short term assets (assets are 0.2x debt).


Financial Institutions Analysis

Asset Level: A4XA's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if A4XA has a sufficient allowance for bad loans.

Low Risk Liabilities: A4XA reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if A4XA has an acceptable proportion of non-loan assets held.

Low Risk Deposits: A4XA has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if A4XA has an appropriate level of bad loans.


Next Steps

Dividend

What is American Homes 4 Rent's current dividend yield, its reliability and sustainability?

0.74%

Current Dividend Yield


Dividend Yield vs Market

company0.7%marketbottom25%1.4%markettop25%3.5%industryaverage2.9%forecastin3Years0.9%

Current dividend yield vs market & industry

Notable Dividend: A4XA's dividend (0.75%) isn’t notable compared to the bottom 25% of dividend payers in the German market (1.38%).

High Dividend: A4XA's dividend (0.75%) is low compared to the top 25% of dividend payers in the German market (3.53%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, A4XA has been paying a dividend for less than 10 years.

Growing Dividend: A4XA has only been paying a dividend for 6 years, and since then payments have not increased.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (37.3%), A4XA's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: A4XA's dividends in 3 years are forecast to be thoroughly covered by earnings (0.05% payout ratio).


Next Steps

Management

What is the CEO of American Homes 4 Rent's salary, the management and board of directors tenure and is there insider trading?

6.8yrs

Average management tenure


CEO

David Singelyn (58yo)

7.3yrs

Tenure

US$473,000

Compensation

Mr. David P. Singelyn, CPA, has been the Chief Executive Officer and Trustee of American Homes 4 Rent since October 2012. Mr. Singelyn has been the Chief Executive Officer and Trustee of American Homes 4 R ...


CEO Compensation Analysis

Compensation vs Market: David's total compensation ($USD473.00K) is below average for companies of similar size in the German market ($USD3.59M).

Compensation vs Earnings: David's compensation has been consistent with company performance over the past year.


Management Age and Tenure

6.8yrs

Average Tenure

57.5yo

Average Age

Experienced Management: A4XA's management team is seasoned and experienced (6.8 years average tenure).


Board Age and Tenure

5.5yrs

Average Tenure

64yo

Average Age

Experienced Board: A4XA's board of directors are considered experienced (5.5 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Sell€2,343,65803 Sep 19
John Corrigan
EntityIndividual
Role
Member of the Board of Directors
Chief Investment Officer & Trustee
Shares100,000
Max Price€23.49
Sell€461,02428 Aug 19
John Corrigan
EntityIndividual
Role
Member of the Board of Directors
Chief Investment Officer & Trustee
Shares20,000
Max Price€23.10
Sell€1,847,96426 Aug 19
John Corrigan
EntityIndividual
Role
Member of the Board of Directors
Chief Investment Officer & Trustee
Shares80,000
Max Price€23.11
Sell€229,37128 May 19
Bryan Smith
EntityIndividual
Role
Chief Operating Officer
Chief Operating Officer
Shares10,519
Max Price€21.81
Sell€3,740,23220 May 19
David Singelyn
EntityIndividual
Role
Chief Executive Officer
CEO & Trustee
Shares174,734
Max Price€21.49
Sell€19,043,51714 May 19
John Corrigan
EntityIndividual
Role
Member of the Board of Directors
Chief Investment Officer & Trustee
Shares900,000
Max Price€21.19
Sell€1,554,78310 May 19
John Corrigan
EntityIndividual
Role
Member of the Board of Directors
Chief Investment Officer & Trustee
Shares73,327
Max Price€21.20
Sell€19,776,17010 May 19
David Singelyn
EntityIndividual
Role
Chief Executive Officer
CEO & Trustee
Shares940,000
Max Price€21.41
Sell€7,017,59815 Mar 19
John Corrigan
EntityIndividual
Role
Member of the Board of Directors
Chief Investment Officer & Trustee
Shares350,000
Max Price€20.05
Sell€90,93114 Mar 19
Bryan Smith
EntityIndividual
Role
Chief Operating Officer
Chief Operating Officer
Shares4,544
Max Price€20.01
Sell€5,280,40713 Mar 19
John Corrigan
EntityIndividual
Role
Member of the Board of Directors
Chief Investment Officer & Trustee
Shares265,000
Max Price€20.04
Sell€2,172,10008 Mar 19
John Corrigan
EntityIndividual
Role
Member of the Board of Directors
Chief Investment Officer & Trustee
Shares110,000
Max Price€19.75
Sell€1,444,47628 Feb 19
David Goldberg
EntityIndividual
Role
Member of the Board of Directors
Shares74,586
Max Price€19.37

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2.5%.


Management Team

  • David Singelyn (58yo)

    CEO & Trustee

    • Tenure: 7.3yrs
    • Compensation: US$473.00k
  • B. Hughes (85yo)

    • Ray Huning

      Executive Vice President of Corporate Tax

      • Tenure: 6.6yrs
    • Stephanie Heim (64yo)

      Chief Governance Officer & Executive VP

      • Tenure: 7yrs
      • Compensation: US$880.23k
    • Tamara Gustavson (57yo)

      Chairman

      • Tenure: 0.7yrs
      • Compensation: US$105.32k
    • Sara Vogt-Lowell (44yo)

      Chief Legal Officer & Secretary

      • Tenure: 7.3yrs
      • Compensation: US$880.23k
    • Jack Corrigan (59yo)

      Chief Investment Officer & Trustee

      • Tenure: 7.3yrs
      • Compensation: US$442.00k
    • Bryan Smith (45yo)

      Chief Operating Officer

      • Tenure: 0.3yrs
      • Compensation: US$1.05m
    • Chris Lau (37yo)

      Chief Financial Officer

      • Tenure: 1.5yrs
      • Compensation: US$1.05m
    • Brian Reitz

      Senior Vice President of Accounting


      Board Members

      • Matt Hart (67yo)

        Lead Independent Trustee

        • Compensation: US$105.32k
      • David Singelyn (58yo)

        CEO & Trustee

        • Tenure: 7.3yrs
        • Compensation: US$473.00k
      • David Goldberg (69yo)

        • Tenure: 0.7yrs
        • Compensation: US$714.54k
      • Ken Woolley (73yo)

        Independent Trustee

        • Tenure: 7.2yrs
        • Compensation: US$112.82k
      • Jim Kropp (70yo)

        Independent Trustee

        • Tenure: 7.2yrs
        • Compensation: US$115.32k
      • Doug Benham (62yo)

        Independent Trustee

        • Tenure: 3.8yrs
        • Compensation: US$105.32k
      • Wendy Webb (61yo)

        Independent Trustee

        • Tenure: 1yrs
      • J. Lynch (66yo)

        Advisory Board Member

        • Tamara Gustavson (57yo)

          Chairman

          • Tenure: 0.7yrs
          • Compensation: US$105.32k
        • Jack Corrigan (59yo)

          Chief Investment Officer & Trustee

          • Tenure: 7.3yrs
          • Compensation: US$442.00k

        Company Information

        American Homes 4 Rent's company bio, employee growth, exchange listings and data sources


        Key Information

        • Name: American Homes 4 Rent
        • Ticker: A4XA
        • Exchange: DB
        • Founded: 2012
        • Industry: Residential REITs
        • Sector: Real Estate
        • Implied Market Cap: US$9.506b
        • Market Cap: US$7.312b
        • Listing Market Cap: US$8.578b
        • Shares outstanding: 352.74m
        • Website: https://www.americanhomes4rent.com

        Number of Employees


        Location

        • American Homes 4 Rent
        • 30601 Agoura Road
        • Suite 200
        • Agoura Hills
        • California
        • 91301
        • United States

        Listings

        TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
        AMHNYSE (New York Stock Exchange)YesClass A Common SharesUSUSDAug 2013
        A4XADB (Deutsche Boerse AG)YesClass A Common SharesDEEURAug 2013
        0HEJLSE (London Stock Exchange)YesClass A Common SharesGBUSDAug 2013
        AMH.PRDNYSE (New York Stock Exchange)RED PFD SER DUSUSDMay 2016
        AMH.PRENYSE (New York Stock Exchange)PFD CUM RED EUSUSDJun 2016
        AMH.PRFNYSE (New York Stock Exchange)CM RED PFD SHS FUSUSDApr 2017
        AMH.PRGNYSE (New York Stock Exchange)5.875% CUM PFD GUSUSDJul 2017
        AMH.PRHNYSE (New York Stock Exchange)6.25% CUM PFD HUSUSDSep 2018

        Biography

        American Homes 4 Rent (NYSE: AMH) is a leader in the single-family home rental industry and "American Homes 4 Rent" is fast becoming a nationally recognized brand for rental homes, known for high-quality, good value and tenant satisfaction. We are an internally managed Maryland real estate investment trust, or REIT, focused on acquiring, developing, renovating, leasing, and operating attractive, single-family homes as rental properties. As of September 30, 2019, we owned 52,537 single-family properties in selected submarkets in 22 states. 


        Company Analysis and Financial Data Status

        All financial data provided by Standard & Poor's Capital IQ.
        DataLast Updated (UTC time)
        Company Analysis2020/01/20 22:01
        End of Day Share Price2020/01/20 00:00
        Earnings2019/09/30
        Annual Earnings2018/12/31


        Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.