Apartment Investment and Management (NYSE:AIV – Get Free Report) and KKR Real Estate Finance Trust (NYSE:KREF – Get Free Report) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, analyst recommendations, dividends, profitability and risk.
Insider and Institutional Ownership
83.3% of Apartment Investment and Management shares are owned by institutional investors. Comparatively, 70.2% of KKR Real Estate Finance Trust shares are owned by institutional investors. 3.0% of Apartment Investment and Management shares are owned by insiders. Comparatively, 1.9% of KKR Real Estate Finance Trust shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for Apartment Investment and Management and KKR Real Estate Finance Trust, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Apartment Investment and Management | 0 | 0 | 0 | 0 | 0.00 |
| KKR Real Estate Finance Trust | 0 | 0 | 6 | 0 | 3.00 |
Profitability
This table compares Apartment Investment and Management and KKR Real Estate Finance Trust’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Apartment Investment and Management | -119.76% | -68.04% | -11.72% |
| KKR Real Estate Finance Trust | 6.30% | 8.53% | 1.75% |
Risk & Volatility
Apartment Investment and Management has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500. Comparatively, KKR Real Estate Finance Trust has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500.
Dividends
Apartment Investment and Management pays an annual dividend of $1.01 per share and has a dividend yield of 11.4%. KKR Real Estate Finance Trust pays an annual dividend of $1.00 per share and has a dividend yield of 9.4%. Apartment Investment and Management pays out -136.5% of its earnings in the form of a dividend. KKR Real Estate Finance Trust pays out 555.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Apartment Investment and Management is clearly the better dividend stock, given its higher yield and lower payout ratio.
Valuation & Earnings
This table compares Apartment Investment and Management and KKR Real Estate Finance Trust”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Apartment Investment and Management | $208.68 million | 6.02 | -$166.20 million | ($0.74) | -11.96 |
| KKR Real Estate Finance Trust | $155.17 million | 4.70 | $35.59 million | $0.18 | 58.94 |
KKR Real Estate Finance Trust has lower revenue, but higher earnings than Apartment Investment and Management. Apartment Investment and Management is trading at a lower price-to-earnings ratio than KKR Real Estate Finance Trust, indicating that it is currently the more affordable of the two stocks.
Summary
KKR Real Estate Finance Trust beats Apartment Investment and Management on 9 of the 16 factors compared between the two stocks.
About Apartment Investment and Management
Apartment Investment & Management Co. operates as a real estate investment trust that engages in the acquisition, ownership, management and redevelopment of apartment properties. The company was founded in 1975 and is headquartered in Denver, CO.
About KKR Real Estate Finance Trust
KKR Real Estate Finance Trust Inc., a mortgage real estate investment trust, focuses primarily on originating and acquiring transitional senior loans secured by commercial real estate (CRE) assets. It engages in the origination and purchase of credit investments related to CRE, including leveraged and unleveraged commercial real estate loans. The company has elected to be taxed as a real estate investment trust and would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. KKR Real Estate Finance Trust Inc. was incorporated in 2014 and is headquartered in New York, New York.
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