American Homes 4 Rent (NYSE: AMH) has received an upgrade from Wall Street Zen, which moved its rating from “sell” to “hold.” This decision reflects a growing confidence among analysts regarding the company’s stock, following recent evaluations by various brokerages.
Several financial institutions have responded to American Homes 4 Rent’s performance with revised price targets. Barclays decreased its estimate from $39.00 to $34.00, maintaining an “equal weight” rating. Meanwhile, Scotiabank reduced its price target from $41.00 to $35.00 with a “sector perform” rating. The Goldman Sachs Group has set a price objective of $37.00, while Morgan Stanley adjusted its target from $41.00 to $40.00 with an “overweight” rating. Mizuho also reiterated a “neutral” stance, lowering its price objective from $33.00 to $32.00.
Analysts have widely varied opinions on the stock, with eight investment analysts recommending a “buy” and nine assigning a “hold” rating. According to data from MarketBeat, the consensus rating currently stands at “hold” with an average price target of $37.63.
Recent Financial Performance
American Homes 4 Rent reported its latest earnings results on October 29, 2023. The real estate investment trust (REIT) posted earnings per share (EPS) of $0.47, surpassing analysts’ expectations of $0.46 by $0.01. The company generated revenues of $478.46 million during the quarter, exceeding the consensus estimate of $475.75 million. In addition, the firm recorded a return on equity of 5.90% and a net margin of 24.70%. This marks a 7.5% year-over-year increase in quarterly revenue compared to the same period last year, when the company reported $0.44 per share.
American Homes 4 Rent has provided guidance for fiscal year 2025, estimating EPS between $1.860 and $1.880. For the current fiscal year, analysts expect an EPS of $1.85.
Dividend Announcement and Insider Activity
The company has also declared a quarterly dividend of $0.30 per share, which was paid on December 31, 2023. Shareholders on record as of December 15 received this dividend, representing an annualized yield of 3.9%. Notably, the payout ratio currently stands at 101.69%.
In insider trading, Director Douglas N. Benham purchased 1,000 shares on November 19 at an average price of $31.65 per share, totaling $31,650. Following this acquisition, he holds 7,991 shares valued at approximately $252,915.15. Director Jack E. Corrigan also acquired 5,000 shares on December 9 at an average cost of $22.96 per share, bringing his total to 17,300 shares worth about $397,208.
Currently, insiders own 6.32% of the stock, while institutional investors hold 91.87% of shares. Various hedge funds have adjusted their positions in American Homes 4 Rent, with Wilmington Savings Fund Society FSB increasing its stake by an impressive 10,728.6% during the third quarter.
Company Overview
American Homes 4 Rent, listed on the NYSE as AMH, is a publicly traded REIT focused on acquiring, developing, and managing single-family rental homes. Since its initial public offering in April 2013, the company has aimed to create a sizable, professionally managed portfolio to cater to the needs of contemporary renters. Its business model emphasizes strategically located properties, backed by consistent in-house property management to enhance occupancy rates and long-term value. Currently, the firm owns and operates tens of thousands of homes across the United States, particularly in key Sun Belt regions and rapidly growing markets.
As American Homes 4 Rent continues to navigate a competitive landscape, the recent upgrades and financial results highlight a potentially promising outlook for investors.
