Shares of American Homes 4 Rent (NYSE: AMH) have been upgraded from a “sell” to a “hold” rating by Wall Street Zen, according to a report released on Saturday morning. This change comes amidst a broader analysis of the company by various brokerage firms, reflecting a cautious optimism regarding its future performance.
Brokerage Adjustments and Ratings
In a series of recent reports, multiple brokerages have adjusted their outlook on American Homes 4 Rent. On November 25, Barclays reduced its price target for the stock from $39.00 to $34.00 while maintaining an “equal weight” rating. Similarly, Scotiabank lowered its price target from $41.00 to $35.00 and has assigned a “sector perform” rating.
The Goldman Sachs Group set a target of $37.00 for the stock on December 15, while Morgan Stanley adjusted its price target from $41.00 to $40.00, holding an “overweight” rating. Lastly, Mizuho reiterated a “neutral” rating and revised its price objective from $33.00 to $32.00.
Currently, eight investment analysts have rated the stock with a “Buy” rating, while nine have assigned it a “Hold” rating. According to data from MarketBeat, the consensus rating for American Homes 4 Rent stands at “Hold” with an average price target of $37.63.
Financial Performance Highlights
American Homes 4 Rent disclosed its latest earnings results on October 29, 2023. The real estate investment trust (REIT) reported earnings of $0.47 per share for the quarter, exceeding analysts’ estimates of $0.46 by $0.01. The company’s revenue reached $478.46 million, which is above the consensus estimate of $475.75 million.
The firm achieved a return on equity of 5.90% and a net margin of 24.70%. Additionally, the quarterly revenue increased by 7.5% compared to the same period last year, when it reported earnings of $0.44 per share. American Homes 4 Rent has projected its FY 2025 earnings per share guidance between $1.860 and $1.880.
Equity research analysts expect that the company will report earnings of $1.85 per share for the current fiscal year.
Dividends and Insider Transactions
In related news, American Homes 4 Rent announced a quarterly dividend of $0.30 per share, which was paid on December 31, 2023. Shareholders recorded on December 15 were eligible for this dividend, representing an annualized yield of 3.9%. The company’s current payout ratio stands at 101.69%.
On November 19, Director Douglas N. Benham purchased 1,000 shares at an average price of $31.65, totaling $31,650. This acquisition increased his ownership to 7,991 shares, valued at approximately $252,915.15. Similarly, Director Jack E. Corrigan acquired 5,000 shares for $22.96 each on December 9, totaling $114,800. Following this transaction, he holds 17,300 shares valued at around $397,208.
Institutional Investment Trends
Several institutional investors have recently adjusted their stakes in American Homes 4 Rent. Wilmington Savings Fund Society FSB significantly increased its position by 10,728.6% in the third quarter, now owning 758 shares valued at $25,000 after acquiring an additional 751 shares. True Wealth Design LLC raised its holdings by 230.8% in the fourth quarter, now owning 827 shares worth $27,000.
Additionally, Hantz Financial Services Inc. boosted its position by 922.2% in the second quarter, bringing its total to 828 shares valued at $30,000. Other firms like AlphaQuest LLC and Parallel Advisors LLC also increased their stakes significantly during the same period, reflecting growing institutional interest in the REIT.
Currently, institutional investors hold 91.87% of American Homes 4 Rent’s stock.
Company Overview
Founded in April 2013, American Homes 4 Rent (NYSE: AMH) is a publicly traded REIT focused on the acquisition, development, and management of single-family rental homes. The company aims to build a large-scale, professionally managed portfolio tailored to meet modern renters’ needs. Its strategy centers around acquiring well-located properties and maintaining consistent in-house management to drive occupancy and long-term value. As of the latest reports, American Homes 4 Rent operates tens of thousands of homes across the United States, concentrating on key Sun Belt and high-growth markets.
As American Homes 4 Rent continues to navigate the evolving real estate landscape, its recent upgrades and financial performance will be closely monitored by analysts and investors alike.
