AVB

AvalonBay CommunitiesNYSE:AVB Stock Report

Market Cap

US$30.7b

7D

-1.6%

1Y

45.6%

Updated

19 Sep, 2021

Data

Company Financials +
AVB fundamental analysis
Snowflake Score
Valuation2/6
Future Growth0/6
Past Performance3/6
Financial Health2/6
Dividends5/6

AVB Overview

As of December 31, 2020, the Company owned or held a direct or indirect ownership interest in 291 apartment communities containing 86,025 apartment homes in 11 states and the District of Columbia, of which 18 communities were under development and one community was under redevelopment.

AvalonBay Communities Competitors

Equity Residential

NYSE:EQR

US$31.1b

Invitation Homes

NYSE:INVH

US$23.1b

Sun Communities

NYSE:SUI

US$23.0b

Essex Property Trust

NYSE:ESS

US$21.7b

Price History & Performance

Summary of all time highs, changes and price drops for AvalonBay Communities
Historical stock prices
Current Share PriceUS$219.89
52 Week HighUS$131.38
52 Week LowUS$233.48
Beta0.95
1 Month Change-2.11%
3 Month Change3.67%
1 Year Change45.57%
3 Year Change18.74%
5 Year Change20.31%
Change since IPO953.37%

Recent News & Updates

Sep 10

Why AvalonBay Is The Best Option For Real Estate Investors

Apartment Trusts are the most reliable and, arguably, the most profitable REITs in the long term. Key points to consider: the company’s size, property types and local diversification. Among several possible options, AvalonBay Communities emerges as a world-class, best-of-breed company.

Sep 02

AvalonBay Communities: Buy Quality, But Not At This Price

AvalonBay Communities is a significant, 1.5% position in my portfolio and one I initiated during the pandemic. The result is an RoR of over 50% in a relatively short time. Some investors still consider this company a "BUY". I do not. In fact, I'm looking at what valuation I would need to consider profit harvesting. This is based on the company's excessive valuation, which we'll look at here.

Shareholder Returns

AVBUS REITsUS Market
7D-1.6%-0.3%-0.6%
1Y45.6%32.5%33.8%

Return vs Industry: AVB exceeded the US REITs industry which returned 32.5% over the past year.

Return vs Market: AVB exceeded the US Market which returned 33.8% over the past year.

Price Volatility

Is AVB's price volatile compared to industry and market?
AVB volatility
AVB Beta0.95
Industry Beta0.82
Market Beta1

Stable Share Price: AVB is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 2% a week.

Volatility Over Time: AVB's weekly volatility (2%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19783,028Tim Naughtonhttps://www.avalonbay.com

As of December 31, 2020, the Company owned or held a direct or indirect ownership interest in 291 apartment communities containing 86,025 apartment homes in 11 states and the District of Columbia, of which 18 communities were under development and one community was under redevelopment. The Company is an equity REIT in the business of developing, redeveloping, acquiring and managing apartment communities in leading metropolitan areas in New England, the New York/New Jersey Metro area, the Mid-Atlantic, the Pacific Northwest, and Northern and Southern California, as well as in the Company's expansion markets consisting of Southeast Florida and Denver, Colorado (the "Expansion Markets").

AvalonBay Communities Fundamentals Summary

How do AvalonBay Communities's earnings and revenue compare to its market cap?
AVB fundamental statistics
Market CapUS$30.65b
Earnings (TTM)US$1.08b
Revenue (TTM)US$2.26b

28.5x

P/E Ratio

13.6x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
AVB income statement (TTM)
RevenueUS$2.26b
Cost of RevenueUS$847.09m
Gross ProfitUS$1.41b
ExpensesUS$338.06m
EarningsUS$1.08b

Last Reported Earnings

Jun 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)7.71
Gross Margin62.55%
Net Profit Margin47.60%
Debt/Equity Ratio69.0%

How did AVB perform over the long term?

See historical performance and comparison

Dividends

2.9%

Current Dividend Yield

81%

Payout Ratio

Valuation

Is AvalonBay Communities undervalued compared to its fair value and its price relative to the market?

19.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: AVB ($219.89) is trading below our estimate of fair value ($273.44)

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


Price To Earnings Ratio

PE vs Industry: AVB is good value based on its PE Ratio (28.5x) compared to the US REITs industry average (50.1x).

PE vs Market: AVB is poor value based on its PE Ratio (28.5x) compared to the US market (17.8x).


Price to Earnings Growth Ratio

PEG Ratio: AVB's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: AVB is overvalued based on its PB Ratio (2.8x) compared to the US REITs industry average (2x).


Future Growth

How is AvalonBay Communities forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

-4.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AVB's earnings are forecast to decline over the next 3 years (-4.5% per year).

Earnings vs Market: AVB's earnings are forecast to decline over the next 3 years (-4.5% per year).

High Growth Earnings: AVB's earnings are forecast to decline over the next 3 years.

Revenue vs Market: AVB's revenue (4.7% per year) is forecast to grow slower than the US market (9.8% per year).

High Growth Revenue: AVB's revenue (4.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AVB's Return on Equity is forecast to be low in 3 years time (6.8%).


Past Performance

How has AvalonBay Communities performed over the past 5 years?

-2.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AVB has a large one-off gain of $661.9M impacting its June 30 2021 financial results.

Growing Profit Margin: AVB's current net profit margins (47.6%) are higher than last year (33.2%).


Past Earnings Growth Analysis

Earnings Trend: AVB's earnings have declined by 2.3% per year over the past 5 years.

Accelerating Growth: AVB's earnings growth over the past year (37.3%) exceeds its 5-year average (-2.3% per year).

Earnings vs Industry: AVB earnings growth over the past year (37.3%) exceeded the REITs industry 3.9%.


Return on Equity

High ROE: AVB's Return on Equity (9.9%) is considered low.


Financial Health

How is AvalonBay Communities's financial position?


Financial Position Analysis

Short Term Liabilities: AVB's short term assets ($738.8M) exceed its short term liabilities ($635.3M).

Long Term Liabilities: AVB's short term assets ($738.8M) do not cover its long term liabilities ($7.8B).


Debt to Equity History and Analysis

Debt Level: AVB's debt to equity ratio (69%) is considered high.

Reducing Debt: AVB's debt to equity ratio has reduced from 69.2% to 69% over the past 5 years.

Debt Coverage: AVB's debt is not well covered by operating cash flow (15.4%).

Interest Coverage: AVB's interest payments on its debt are not well covered by EBIT (2.9x coverage).


Balance Sheet


Dividend

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

2.89%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: AVB's dividend (2.89%) is higher than the bottom 25% of dividend payers in the US market (1.33%).

High Dividend: AVB's dividend (2.89%) is low compared to the top 25% of dividend payers in the US market (3.6%).


Stability and Growth of Payments

Stable Dividend: AVB's dividends per share have been stable in the past 10 years.

Growing Dividend: AVB's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (81%), AVB's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AVB's dividends in 3 years are forecast to be covered by earnings (75.2% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

10.4yrs

Average management tenure


CEO

Tim Naughton (60 yo)

9.67yrs

Tenure

US$11,294,333

Compensation

Mr. Timothy J. Naughton, also known as Tim, has been the Chief Executive Officer of AvalonBay Communities Inc. since January 1, 2012 and was its President since February 23, 2015 until January 2021. Mr. Na...


CEO Compensation Analysis

Compensation vs Market: Tim's total compensation ($USD11.29M) is about average for companies of similar size in the US market ($USD11.33M).

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


Leadership Team

Experienced Management: AVB's management team is seasoned and experienced (10.4 years average tenure).


Board Members

Experienced Board: AVB's board of directors are considered experienced (5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: AVB insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

AvalonBay Communities, Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: AvalonBay Communities, Inc.
  • Ticker: AVB
  • Exchange: NYSE
  • Founded: 1978
  • Industry: Residential REITs
  • Sector: Real Estate
  • Implied Market Cap: US$30.650b
  • Market Cap: US$30.649b
  • Shares outstanding: 139.39m
  • Website: https://www.avalonbay.com

Number of Employees


Location

  • AvalonBay Communities, Inc.
  • 4040 Wilson Boulevard
  • Suite 1000
  • Arlington
  • Virginia
  • 22203
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/09/19 22:01
End of Day Share Price2021/09/17 00:00
Earnings2021/06/30
Annual Earnings2020/12/31


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.