NYSE:APTS

Stock Analysis Report

Preferred Apartment Communities

Executive Summary

Preferred Apartment Communities, Inc. is a Maryland corporation formed primarily to own and operate multifamily properties and, to a lesser extent, own and operate student housing properties, grocery-anchored shopping centers and strategically located, well leased class A office buildings, all in select targeted markets throughout the United States.

Snowflake

Fundamentals

Mediocre balance sheet second-rate dividend payer.


Similar Companies

Share Price & News

How has Preferred Apartment Communities's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-1.9%

NYSE:APTS

0.2%

US REITs

-1.0%

US Market


1 Year Return

-19.8%

NYSE:APTS

8.2%

US REITs

-0.4%

US Market

APTS underperformed the REITs industry which returned 7.6% over the past year.

APTS underperformed the Market in United States of America which returned -1.7% over the past year.


Share holder returns

APTSIndustryMarket
7 Day-1.9%0.2%-1.0%
30 Day-3.0%2.0%-3.3%
90 Day-14.8%2.9%0.4%
1 Year-14.4%-19.8%13.0%8.2%1.8%-0.4%
3 Year21.8%1.1%25.0%8.7%39.4%30.4%
5 Year127.2%64.4%58.7%25.0%54.2%37.1%

Price Volatility Vs. Market

How volatile is Preferred Apartment Communities's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Preferred Apartment Communities undervalued based on future cash flows and its price relative to the stock market?

0.35x

Price to Book (PB) ratio


Intrinsic Value Based on Future Cash Flows

Preferred Apartment Communities's share price is above the future cash flow value, it's not available at a moderate discount (< 20%).

Preferred Apartment Communities's share price is above the future cash flow value, it's not available at a substantial discount (< 40%).


Price Based on Earnings

Preferred Apartment Communities is loss making, we can't compare its value to the US REITs industry average.

Preferred Apartment Communities is loss making, we can't compare the value of its earnings to the United States of America market.


Price Based on Expected Growth

Unable to calculate PEG ratio for Preferred Apartment Communities, we can't assess if its growth is good value.


Price Based on Value of Assets

Preferred Apartment Communities is good value based on assets compared to the US REITs industry average.


Next Steps

Future Growth

How is Preferred Apartment Communities expected to perform in the next 1 to 3 years based on estimates from 3 analysts?

-18.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Preferred Apartment Communities's revenue is expected to grow by 16.4% yearly, however this is not considered high growth (20% yearly).

Preferred Apartment Communities is not considered high growth as it is expected to be loss making for the next 1-3 years.

Preferred Apartment Communities's revenue growth is expected to exceed the United States of America market average.

Unable to compare Preferred Apartment Communities's earnings growth to the United States of America market average as it is expected to be loss making during the next 1-3 years.

Unable to compare Preferred Apartment Communities's earnings growth to the low risk savings rate as it is expected to be loss making during the next 1-3 years.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if Preferred Apartment Communities will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


Next Steps

Past Performance

How has Preferred Apartment Communities performed over the past 5 years?

-38.7%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Preferred Apartment Communities does not make a profit and their year on year earnings growth rate was negative over the past 5 years.

Unable to compare Preferred Apartment Communities's 1-year earnings growth to the 5-year average as it is not currently profitable.

Unable to compare Preferred Apartment Communities's 1-year growth to the US REITs industry average as it is not currently profitable.


Return on Equity

Preferred Apartment Communities has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

Preferred Apartment Communities used its assets less efficiently than the US REITs industry average last year based on Return on Assets.


Return on Capital Employed

It is difficult to establish if Preferred Apartment Communities improved its use of capital last year versus 3 years ago (Return on Capital Employed) as it is currently loss-making.


Next Steps

Financial Health

How is Preferred Apartment Communities's financial position?


Financial Position Analysis

Preferred Apartment Communities is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Preferred Apartment Communities's long term commitments exceed its cash and other short term assets.


Debt to Equity History and Analysis

Preferred Apartment Communities's level of debt (168.2%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has increased over the past 5 years (91.8% vs 168.2% today).


Balance Sheet

High level of physical assets or inventory.

Debt is not covered by short term assets, assets are 0.1x debt.


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Whilst loss making Preferred Apartment Communities has sufficient cash runway for more than 3 years if it maintains the current positive free cash flow level.

Whilst loss making Preferred Apartment Communities has sufficient cash runway for more than 3 years, even with free cash flow being positive and shrinking by -36.8% per year.


Next Steps

Dividend

What is Preferred Apartment Communities's current dividend yield, its reliability and sustainability?

7.46%

Expected Dividend Yield


Upcoming Dividend Payment

Purchase Preferred Apartment Communities before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield and Payments Analysis

Preferred Apartment Communities's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.5%).

Preferred Apartment Communities's dividend is above the markets top 25% of dividend payers in United States of America (3.9%).

Whilst dividend payments have been stable, Preferred Apartment Communities has been paying a dividend for less than 10 years.

Dividend payments have increased, but Preferred Apartment Communities only paid a dividend in the past 8 years.


Current Payout to Shareholders

Dividends paid are not well covered by earnings (0.4x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be thoroughly covered by earnings (84.7x coverage).


Next Steps

Management

What is the CEO of Preferred Apartment Communities's salary, the management and board of directors tenure and is there insider trading?

2.9yrs

Average management tenure


CEO

Dan DuPree (72yo)

1.3yrs

Tenure

US$1,732,607

Compensation

Mr. Daniel M. DuPree, also known as Dan, has been Chairman and Chief Executive Officer of Preferred Apartment Communities, Inc. since April 16, 2018. Mr. DuPree served as the Vice Chairman of Preferred Apa ...


CEO Compensation Analysis

Dan's remuneration is lower than average for companies of similar size in United States of America.

Dan's compensation has increased whilst company is loss making.


Management Age and Tenure

2.9yrs

Average Tenure

60yo

Average Age

The tenure for the Preferred Apartment Communities management team is about average.


Board Age and Tenure

5.6yrs

Average Tenure

63yo

Average Age

The tenure for the Preferred Apartment Communities board of directors is about average.


Insider Trading

No 3 month open market individual insider trading information.


Recent Insider Transactions

SellUS$26,83811 Dec 18
William Gresham
EntityIndividual
Role
Member of the Board of Directors
Shares1,800
Max PriceUS$14.91
SellUS$99,60504 Sep 18
Timothy Peterson
EntityIndividual
Role
Member of the Board of Directors
Shares5,500
Max PriceUS$18.11

Ownership Breakdown


Management Team

  • Joel Murphy (60yo)

    Director

    • Tenure: 4.9yrs
    • Compensation: $1.41m
  • Jeff Sherman

    Executive VP & MD of Multifamily

  • Lenny Silverstein (60yo)

    Co-Founder

    • Tenure: 7.0yrs
    • Compensation: $1.73m
  • Jeffrey Sprain (47yo)

    Executive VP

    • Tenure: 10.6yrs
    • Compensation: $497.10k
  • Paul Cullen

    Executive VP & Chief Marketing Officer

    • Tenure: 2.9yrs
  • John Isakson (48yo)

    CFO & Executive VP

    • Tenure: 1.1yrs
    • Compensation: $651.76k
  • Kimberly Hodge

    Executive VP & Chief Property Management Officer

    • Tenure: 1.6yrs
  • Rob Gayle

    Chief Operating Officer of Preferred Residential Management LLC

    • Tenure: 1.0yrs
  • Dan DuPree (72yo)

    Chairman & CEO

    • Tenure: 1.3yrs
    • Compensation: $1.73m
  • Mike Cronin (64yo)

    Executive VP

    • Tenure: 9.9yrs
    • Compensation: $687.80k

Board Members

  • Sara Finley (58yo)

    Independent Director

    • Tenure: 0.3yrs
  • Johnny Gresham (76yo)

    Independent Director

    • Tenure: 5.6yrs
    • Compensation: $80.00k
  • Lenny Silverstein (60yo)

    Co-Founder

    • Tenure: 1.3yrs
    • Compensation: $1.73m
  • Gary Coursey (79yo)

    Independent Director

    • Tenure: 8.7yrs
    • Compensation: $90.00k
  • John Wiens (63yo)

    Independent Director

    • Tenure: 3.3yrs
    • Compensation: $80.00k
  • Howard McLure (62yo)

    Lead Independent Director

    • Tenure: 5.6yrs
    • Compensation: $102.80k
  • Steve Bartkowski (66yo)

    Independent Director

    • Tenure: 8.4yrs
    • Compensation: $99.80k
  • Timothy Peterson (54yo)

    Independent Director

    • Tenure: 8.4yrs
    • Compensation: $103.00k
  • Dan DuPree (72yo)

    Chairman & CEO

    • Tenure: 1.3yrs
    • Compensation: $1.73m

Company Information

Preferred Apartment Communities, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Preferred Apartment Communities, Inc.
  • Ticker: APTS
  • Exchange: NYSE
  • Founded: 2009
  • Industry: residential reits
  • Sector: real estate
  • Implied Market Cap: US$641.073m
  • Market Cap: US$636.246m
  • Shares outstanding: 45.31m
  • Website: Click here

Location

  • Preferred Apartment Communities, Inc.
  • 3284 Northside Parkway NW
  • Suite 150
  • Atlanta
  • Georgia
  • 30327
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
APTSNYSE (New York Stock Exchange)YesCommon StockUSUSDApr 2011
P2ADB (Deutsche Boerse AG)YesCommon StockDEEURApr 2011

Biography

Preferred Apartment Communities, Inc. is a Maryland corporation formed primarily to own and operate multifamily properties and, to a lesser extent, own and operate student housing properties, grocery-ancho ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/17 00:17
End of Day Share Price2019/08/16 00:00
Earnings2019/06/30
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.