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EQR

Equity Residential NYSE:EQR Stock Report

Last Price

US$68.39

Market Cap

US$26.6b

7D

-6.5%

1Y

-16.1%

Updated

25 Sep, 2022

Data

Company Financials +

Equity Residential Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Equity Residential
Historical stock prices
Current Share PriceUS$68.39
52 Week HighUS$94.32
52 Week LowUS$67.48
Beta0.84
1 Month Change-10.05%
3 Month Change-6.58%
1 Year Change-16.13%
3 Year Change-20.71%
5 Year Change3.73%
Change since IPO377.83%

Recent News & Updates

Sep 15

Equity Residential declares $0.625 dividend

Equity Residential (NYSE:EQR) declares $0.625/share quarterly dividend, in line with previous. Forward yield 3.43% Payable Oct. 14; for shareholders of record Sept. 26; ex-div Sept. 23. See EQR Dividend Scorecard, Yield Chart, & Dividend Growth.

Aug 31

Equity Residential sees 2022 revenue growth meeting, beating guidance midpoint

Equity Residential (NYSE:EQR) expects same-store revenue growth to meet or beat 10.5%, the midpoint of its 2022 guidance range, the apartment REIT said Wednesday. Consistent with normal seasonal demand patterns, rents peaked for the year in early August 2022 and are expected to moderate for the rest of the year, the company said. Equity Residential (EQR) said its same-store residential blended rent rate rose 11.8% Y/Y, according to preliminary data, vs. a 12.8% increase in July and 14.3% increase in June. Same-store physical occupancy stood at 96.6% in August, a tick down from 96.5% in July and from 96.7% in June. Percentage of residents renewing by month were 52% in both August and July and 55% in June. Equity Residential (EQR) shares were up 0.4% in Wednesday premarket trading. Earlier this month (Aug. 19), Redfin said U.S. median asking rent slowed for the second straight month in July.

Aug 23

Equity Residential: Inflation Protection And Shares Reasonably Valued

Apartment REITs have the ability to adjust rents quickly, which can be very positive in an inflationary environment. EQR is our favorite apartment REIT, in large part due to a focus on a more affluent demographic. We view shares as fairly valued, trading at close to their average historical valuation multiples on a number of indicators. While many REITs boast about having long leases lasting many years, sometimes decades, this is not always an advantage. Especially during times of high inflation, because even if there are rent escalators in these leases, they usually fail to make up for inflation. In a high inflationary environment, you want to be able to adjust your rents often, and that is where apartment REITs shine. One we particularly like is Equity Residential (EQR), which is one of the nation's largest publicly traded owners and operators of high-quality rental apartment properties. In other words, they buy, build and manage multifamily properties, with a focus on affluent long-term renters. It has about 311 communities, with a total of 80,581 units, in 12 markets. As can be seen in the slide below, it tends to operate in very dynamic markets, where the affluent renter demographic tends to be large and growing. This includes both urban and suburban properties. Equity Residential Investor Presentation Equity Residential's affluent resident tends to work in the highest earnings sectors of the economy and is not rent burdened, which create the ability to raise rents more readily in good economic times, and reduces non-payment risk during downturns. The average EQR resident spends 19.5% of income in rent as of 2022. So far this year, EQR is beating inflation. The pricing trend, which is the net effective price of its units inclusive of concessions, has grown almost 10% since the beginning of the year, well above the 6% range that historically characterizes a very good year. The current net effective loss to lease, which represents the amount of money that EQR is losing by not charging market rents, is currently ~13.5%. This means that there are still gains to be had as leases expire and are renewed closer to the market average. From the most recent earnings call, we particularly liked an answer CEO Mark Parrell gave in relation to EQR's ability to beat inflation and deliver a real return: So the way we're feeling about it is that we're going to be able to provide a pretty good margin to whatever the inflation numbers are especially as we expect them to sort of settle down. There is also this little bit of a circular reference thing where rent is something like third of the CPI. So we feed into that number, and that number feeds into our number. And so there is a little bit of that as well. But I think you should expect that apartments, especially our portfolio, are optimized in a way with our pricing engine that we can continue to have a real return that exceeds the rate of inflation. The company should also be able to continue performing well thanks to the benefit of good supply and demand dynamics, including excellent job growth and household formation. Housing alternatives also remain expensive and in low supply. Single-family home prices reached record levels in 2022 while rising mortgage rates have further stressed affordability, particularly for first-time home-buyers. Additionally, single-family housing starts are declining. The near-term apartment supply picture also remains favorable. Starts within close proximity to EQR's properties in its coastal markets are still at or below pre-pandemic levels. In addition, it seems likely that over the next few quarters new apartment starts should decline due to higher pricing of construction and financing, and continued supply chain disruptions. EQR's affluent renter base should be able to weather rising inflation in part due to lower relative rent-to-income ratios, and higher amounts of disposable income. As in the past, if inflation does persist, EQR's business should continue to perform relatively well. Balance Sheet Equity Residential continues to have one of the strongest balance sheets in the REIT sector, with low floating rate exposure and a long weighted average maturity. EQR also has relatively low leverage and has strong credit ratings (A-/A3). EQR Financial Debt to EBITDA ((TTM)) data by YCharts 2Q 2022 Results The 2Q results for Equity Residential were somewhat better than expected. Same-store occupancy improved to 96.7% while same-store revenue increased 13.6% year over year. Same-store expense growth continued to remain in check at 3.1%. Equity Residential reported normalized funds from operations of $0.89 per share, well ahead of the $0.72 the company reported in Q2 2021. Guidance The strong quarter led management to raise its full-year guidance. Management boosted its same-store revenue growth projections by 1.5%, at the midpoint, to a new range of between 10% and 11%. It guided normalized FFO for the year to a new range of between $3.48 and $3.58. Valuation We currently view shares as fairly valued, trading not that far from the ten-year average price/book value of ~2.4x.

Shareholder Returns

EQRUS REITsUS Market
7D-6.5%-6.2%-5.2%
1Y-16.1%-18.5%-23.0%

Return vs Industry: EQR exceeded the US REITs industry which returned -18.5% over the past year.

Return vs Market: EQR exceeded the US Market which returned -23% over the past year.

Price Volatility

Is EQR's price volatile compared to industry and market?
EQR volatility
EQR Average Weekly Movement3.1%
REITs Industry Average Movement3.7%
Market Average Movement6.9%
10% most volatile stocks in US Market15.8%
10% least volatile stocks in US Market2.8%

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

Volatility Over Time: EQR's weekly volatility (3%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19662,400Mark Parrellhttps://www.equityapartments.com

Equity Residential is committed to creating communities where people thrive. The Company, a member of the S&P 500, is focused on the acquisition, development and management of residential properties located in and around dynamic cities that attract high quality long-term renters. Equity Residential owns or has investments in 305 properties consisting of 78,568 apartment units, located in Boston, New York, Washington, D.C., Seattle, San Francisco, Southern California and Denver.

Equity Residential Fundamentals Summary

How do Equity Residential's earnings and revenue compare to its market cap?
EQR fundamental statistics
Market CapUS$26.60b
Earnings (TTM)US$1.25b
Revenue (TTM)US$2.61b

20.6x

P/E Ratio

9.9x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
EQR income statement (TTM)
RevenueUS$2.61b
Cost of RevenueUS$973.61m
Gross ProfitUS$1.64b
Other ExpensesUS$384.40m
EarningsUS$1.25b

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)3.33
Gross Margin62.68%
Net Profit Margin47.94%
Debt/Equity Ratio69.3%

How did EQR perform over the long term?

See historical performance and comparison

Dividends

3.7%

Current Dividend Yield

74%

Payout Ratio
We’ve recently updated our valuation analysis.

Valuation

Is EQR undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

6/6

Valuation Score 6/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for EQR?

Other financial metrics that can be useful for relative valuation.

EQR key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue13.3x
Enterprise Value/EBITDA22x
PEG Ratio5.6x

Price to Earnings Ratio vs Peers

How does EQR's PE Ratio compare to its peers?

EQR PE Ratio vs Peers
The above table shows the PE ratio for EQR vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average41.8x
AVB AvalonBay Communities
32.4x2.9%US$26.4b
INVH Invitation Homes
61.7x13.0%US$21.5b
MAA Mid-America Apartment Communities
31.1x0.8%US$18.8b
ESS Essex Property Trust
41.9x14.2%US$16.7b
EQR Equity Residential
20.6x3.7%US$26.6b

Price-To-Earnings vs Peers: EQR is good value based on its Price-To-Earnings Ratio (20.6x) compared to the peer average (41.8x).


Price to Earnings Ratio vs Industry

How does EQR's PE Ratio compare vs other companies in the US REITs Industry?

Price-To-Earnings vs Industry: EQR is good value based on its Price-To-Earnings Ratio (20.6x) compared to the US REITs industry average (27x)


Price to Earnings Ratio vs Fair Ratio

What is EQR's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

EQR PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio20.6x
Fair PE Ratio41.2x

Price-To-Earnings vs Fair Ratio: EQR is good value based on its Price-To-Earnings Ratio (20.6x) compared to the estimated Fair Price-To-Earnings Ratio (41.2x).


Share Price vs Fair Value

What is the Fair Price of EQR when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: EQR ($68.39) is trading below our estimate of fair value ($99.04)

Significantly Below Fair Value: EQR is trading below fair value by more than 20%.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.


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Future Growth

How is Equity Residential forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


3.7%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: EQR's forecast earnings growth (3.7% per year) is above the savings rate (1.9%).

Earnings vs Market: EQR's earnings (3.7% per year) are forecast to grow slower than the US market (14.7% per year).

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

Revenue vs Market: EQR's revenue (4.2% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: EQR's revenue (4.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: EQR's Return on Equity is forecast to be low in 3 years time (6.2%).


Discover growth companies

Past Performance

How has Equity Residential performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


13.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: EQR has a large one-off gain of $939.3M impacting its June 30 2022 financial results.

Growing Profit Margin: EQR's current net profit margins (47.9%) are higher than last year (29.4%).


Past Earnings Growth Analysis

Earnings Trend: EQR's earnings have grown by 13.3% per year over the past 5 years.

Accelerating Growth: EQR's earnings growth over the past year (74.9%) exceeds its 5-year average (13.3% per year).

Earnings vs Industry: EQR earnings growth over the past year (74.9%) exceeded the REITs industry 45.8%.


Return on Equity

High ROE: EQR's Return on Equity (11.4%) is considered low.


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Financial Health

How is Equity Residential's financial position?

Financial Health Score

1/6

Financial Health Score 1/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: EQR's short term assets ($141.6M) do not cover its short term liabilities ($617.3M).

Long Term Liabilities: EQR's short term assets ($141.6M) do not cover its long term liabilities ($8.5B).


Debt to Equity History and Analysis

Debt Level: EQR's net debt to equity ratio (68.9%) is considered high.

Reducing Debt: EQR's debt to equity ratio has reduced from 82.2% to 69.3% over the past 5 years.

Debt Coverage: EQR's debt is not well covered by operating cash flow (17.3%).

Interest Coverage: EQR's interest payments on its debt are not well covered by EBIT (2.4x coverage).


Balance Sheet


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Dividend

What is Equity Residential current dividend yield, its reliability and sustainability?

Dividend Score

4/6

Dividend Score 4/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage


3.66%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: EQR's dividend (3.66%) is higher than the bottom 25% of dividend payers in the US market (1.66%).

High Dividend: EQR's dividend (3.66%) is low compared to the top 25% of dividend payers in the US market (4.57%).


Stability and Growth of Payments

Stable Dividend: EQR's dividend payments have been volatile in the past 10 years.

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


Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (74%), EQR's dividend payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: With its reasonable cash payout ratio (70.8%), EQR's dividend payments are covered by cash flows.


Discover strong dividend paying companies

Management

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

4.1yrs

Average management tenure


CEO

Mark Parrell (55 yo)

4yrs

Tenure

US$8,490,527

Compensation

Mr. Mark J. Parrell serves as Director at Real Estate Roundtable since July 1, 2021. He has been the Chief Executive Officer and Trustee at Equity Residential since January 1, 2019 and its President since...


CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD8.49M) is below average for companies of similar size in the US market ($USD13.05M).

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


Leadership Team

Experienced Management: EQR's management team is considered experienced (4.1 years average tenure).


Board Members

Experienced Board: EQR's board of directors are seasoned and experienced ( 11.9 years average tenure).


Ownership

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


Insider Trading Volume

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


Recent Insider Transactions

NYSE:EQR Recent Insider Transactions by Companies or Individuals
DateValueNameEntityRoleSharesMax Price
04 Feb 22SellUS$144,208Alexander BrackenridgeIndividual1,600US$90.13
04 Feb 22SellUS$14,421Catherine CarrawayIndividual160US$90.13
04 Feb 22SellUS$99,323Scott FensterIndividual1,102US$90.13
04 Feb 22SellUS$78,413Ian KaufmanIndividual870US$90.13
04 Feb 22SellUS$249,660Robert GarechanaIndividual2,770US$90.13
04 Feb 22SellUS$327,082Michael ManelisIndividual3,629US$90.13

Ownership Breakdown

What is the ownership structure of EQR?
Owner TypeNumber of SharesOwnership Percentage
State or Government161,7560.04%
Individual Insiders6,118,3131.6%
General Public21,698,5255.8%
Institutions348,139,66692.6%

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


Top Shareholders

Top 25 shareholders own 71.64% of the company
OwnershipNameSharesCurrent ValueChange %Portfolio %
15.21%
The Vanguard Group, Inc.
57,221,471$3.9b-0.82%0.09%
9.8%
BlackRock, Inc.
36,852,709$2.5b0.08%0.06%
8.02%
Norges Bank Investment Management
30,158,685$2.1b0%0.27%
6.37%
State Street Global Advisors, Inc.
23,945,398$1.6b-0.95%0.09%
4.89%
T. Rowe Price Group, Inc.
18,410,214$1.3b-0.52%0.15%
3.23%
Stichting Pensioenfonds ABP
12,132,810$829.8m-2.59%1.15%
2.72%
Managed Account Advisors LLC
10,240,873$700.4m-2.4%0.2%
2%
Geode Capital Management, LLC
7,526,963$514.8m0.87%0.07%
1.75%
Resolution Capital Limited
6,596,137$451.1m24.71%6.39%
1.66%
Macquarie Investment Management Business Trust
6,228,897$426.0m-0.33%0.47%
1.49%
Northern Trust Global Investments
5,611,180$383.7m-4.79%0.08%
1.48%
First Eagle Investment Management, LLC
5,554,046$379.8m1.59%0.66%
1.43%
Dimensional Fund Advisors LP
5,393,566$368.9m-1.29%0.09%
1.42%
Legal & General Investment Management Limited
5,332,783$364.7m1.67%0.11%
1.29%
Samuel Zell
4,847,271$331.5m0%no data
1.09%
CenterSquare Investment Management LLC
4,087,172$279.5m13.52%3.77%
1.04%
CPP Investments
3,917,260$267.9m9.48%0.26%
1.01%
UBS Asset Management
3,791,887$259.3m-7.6%0.05%
0.93%
BNY Mellon Asset Management
3,492,274$238.8m3.72%0.05%
0.91%
Teachers Insurance and Annuity Association-College Retirement Equities Fund
3,419,640$233.9m-7.9%0.08%
0.87%
Charles Schwab Investment Management, Inc.
3,272,605$223.8m-1.43%0.06%
0.84%
Security Capital Research & Management Incorporated
3,144,600$215.1m30.11%7.23%
0.82%
Boston Partners Global Investors, Inc.
3,079,490$210.6m1.91%0.18%
0.72%
Merrill Lynch & Co. Inc., Banking Investments
2,723,291$186.2m-5.15%0.1%
0.66%
PGIM, Inc.
2,469,003$168.9m4.39%0.24%

Company Information

Equity Residential's employee growth, exchange listings and data sources


Key Information

  • Name: Equity Residential
  • Ticker: EQR
  • Exchange: NYSE
  • Founded: 1966
  • Industry: Residential REITs
  • Sector: Real Estate
  • Implied Market Cap: US$26.602b
  • Market Cap: US$25.723b
  • Shares outstanding: 388.97m
  • Website: https://www.equityapartments.com

Number of Employees


Location

  • Equity Residential
  • Two North Riverside Plaza
  • Suite 400
  • Chicago
  • Illinois
  • 60606
  • United States


Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
EQRNYSE (New York Stock Exchange)YesCommon SharesUSUSDAug 1993
EQRDB (Deutsche Boerse AG)YesCommon SharesDEEURAug 1993
EQRXTRA (XETRA Trading Platform)YesCommon SharesDEEURAug 1993
0IIBLSE (London Stock Exchange)YesCommon SharesGBUSDAug 1993
EQRBRSE (Berne Stock Exchange)YesCommon SharesCHCHFAug 1993
EQR *BMV (Bolsa Mexicana de Valores)YesCommon SharesMXMXNAug 1993
E1QR34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 COM USD0.01BRBRLJan 2020

Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/09/25 00:00
End of Day Share Price2022/09/23 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


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.