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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
American Homes 4 Rent (XNYS:AMH) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
AMH
Name:
AMERICAN HOMES 4 RENT (XNYS:AMH)
Sector:
134.56M
Industry:
REIT�Residential
CEO:
Mr. David Singelyn
Total Employees:
1,538
Our Technological Advancement Rating
Our Rating:
A
Technological advancement compared to industry is 174.47% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF AMERICAN HOMES 4 RENT(AMH) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND REIT�RESIDENTIAL INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
35.03
One Month Price Target:
$35.15
Six Month Price Target :
$35.74
Likely Price in One Year's Time:
Ticker:
$36.45
Likely Trading Range Today Under (Normal Volatility)
$34.94
Price Upper limit ($) :
$35.17
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$33.63
This week:
$31.91
This month :
$28.78
Other Primary facts
Market Cap:
12.20B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
348.37M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
11.96%
-14.78%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$41.51
$38.51
$28.55
$31.55
Medium risk (<10%) entry points
Buy Call
Sell Call
$37.54
Buy Put:
Sell Put:
$36.90
$32.51
$33.16
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
AMH
Sharpe Ratio:
2.81%
Comparison:
AMH, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 76.93% higher than the industry
& ratio is 23.13% higher than the market/S&P 500 average
Average Returns/Yield of
AMH
Daily returns:
0.06%
Weekly returns:
0.32%
Monthly returns:
1.28%
Yearly returns:
13.06%
Comparison of returns:
Average annual returns/yield (last 3 years) is 18.03% above industry average
Classification:
AMH, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.71
Statistical test of Returns:
AMH has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
1.97%
Weekly Volatility:
4.41%
Monthly Volatility:
8.82%
Yearly Volatility:
30.56%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.16%
Volatility in last five trading days has been -41.41% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-3.99%
Weekly VaR:
-8.92%
Monthly VaR:
-17.83%
How Much Can the price of
AMH
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-15%
Worst case (decline):
-61.77%
This translates to price declining to:
$29.76
This translates to price declining to:
$13.39
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
AMH is a 25.86% riskier investment compared to the market/S&P 500 & is 7.82% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -19.55% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
AMH
Beta in relation to market/S&P 500--0.60
Expected beta in 1 year's time:
0.562
Expected beta in 3 year's time:
0.795
Unlevered (debt free) Beta:
-
Beta in relation to Nasdaq (XNAS):
0.647
Beta in relation to all global stocks::
0.657
Beta Comparison & Analysis
Beta of competitors/peers::
1.006
Beta is -39.89% lower than peers
Average Industry Beta:
0.785
Beta is -23.00% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
0.81%
Sustainable growth rate is -84.74% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.081
Alpha is 79.34% above industry average alpha yield
Alpha is 517% higher than market/& is unsustainably high
Analysis of Cost of Capital of
AMH
Equity cost of capital:
0.073
Equity cost of capital is -14.50% below industry mean WACC
Unlevered (without debt) cost of capital:
-
Before-tax cost of debt:
27.92%
After-tax cost of debt:
22.05%
Overall debt rating:
Non-investment grade (junk/speculative grade
Weighted average cost of capital (WACC):
22.05%
WACC is 31.90% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$2.85
Revenue growth rate per share of (3Y):
1.92
Annual revenue growth rate is 123.84% above the industry average
EPS:
$0.48
Expected Annual growth rate of EPS (3Y):
12.24%
Expected future EPS growth rate is 141.80% higher than the REIT�Residential industry
Free cash flow (FCF) per share:
$1.20
Balance sheet equity growth per share: -100.00%
Equity growth rate per share is 2321.04% higher than the industry
Debt per share
$0.00
EBITDA per share
$1.76
Valuation Analysis Today of
AMH
P/E Ratio:
61.17
P/E Ratio of Competitors/Peers:
22.2
P/E ratio is 175.51% higher than main peers & is -7.75% lower than the industry
Stock price/value with industry average P/E ratio: $31.83
AMH is 10.05% overvalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
12.31
Price to sales ratio is 5.00% above the industry mean
P/B (Price to book value ratio):
1.92
Price to free cash flow: 29.22
Price to free cash flow ratio is -8.89% lower than the industry
Net income growth rate (3Y):
67.25%
Net income growth rate is -106.25% lower than the industry average net income growth rate
Dividend Analysis
-
Dividend yeild: 1.60%
Previous Dividend: $0.18
Previous adjusted dividend: $0.18
Previous Dividend: $0.56
Expected next dividend best case: $0.22
Expected next dividend worst case: $0.14
Average dividend payment (long-term): $0.09
Average dividend increase/decrease (growth rate) % per period: 18.00%
Expected next dividend payment date: 28/09/2022
Expected next dividend record date: 13/09/2022
-
Previous dividend payment date: 30/06/2022
Previous dividend record date: 15/06/2022
-
Dividend History:
2022-06-14--$0.18
2021-12-14--$0.10
2021-06-14--$0.10
2022-03-14--$0.18
2021-09-14--$0.10
2021-03-12--$0.10
Dividend growth rate is -166.44% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
66.42%
Net debt to equity ratio:
5.49%
Debt to assets ratio:
37.34%
Net debt to assets ratio:
3.31%
Debt-to-asset ratio is -26.76% below industry average
Ability to repay debt:
Interest coverage ratio:
5.35
Interest coverage ratio is 104.32% more than industry average
Looking forward:
Debt growth rate:
36.80%
Annual debt growth is -925% lower than industry average debt growth rate
-
Analysis of Key Statistics
Correlation of price movement with the market:
0.672
Statistical significance of correlation:
AMH has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.63
Stock price is 6.76% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.63
Correlation of price movement with Nasdaq (^IXIC):
0.027
Covariance of price movement with the market:
0.031
Kurtosis
8.168
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.454
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
AMH
Gross Profit Margin Ratio:
165%
Operating Profit Margin Ratio:
22.46%
Operating profit margin is -26.15% lower than the industry
Net Profit Margin Ratio:
165%
Effective Tax Rate:
-
-
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
3.13%
Return on equity (ROE) is -63.35% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.88%
Return on assets (ROA) is -46.29% lower than the industry
Financial Leverage:
1.6x
Current Ratio:
0.21
Current ratio is -97.79% below industry average
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 7.9 years
Stock based compensation to net income ratio:
3.68%
In-depth Efficiency Analysis
Revenue generated per employee:
644.5K
Each employee generates -20% less revenue than industry average revenue per employee
EBITDA generated per employee:
397.8K
Each employee generates -32% less EBITDA than industry average revenue per employee
Profit generated per employee:
130.7K
Each employee generates -41% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
87.5K
Each employee generates 18% more free cash flow than industry average revenue per employee
Assets/Capital per employee
78.2K
Each employee generates 18% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
AMH
MEDICAL PROPERTIES TRUST, INC. (XNYS:MPW)
VNO-PL
MAA-PI
VNO-PM
HOST HOTELS & RESORTS, INC. (XNAS:HST)
JONES LANG LASALLE INCORPORATED (XNYS:JLL)
EQUITY LIFESTYLE PROPERTIES, INC. (XNYS:ELS)
W.P. CAREY INC. (XNYS:WPC)
KIMCO REALTY CORPORATION (XNYS:KIM)
Current Analyst Ratings
Strong buy�21%
Buy�17%
Hold�25%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
991.31M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
444.68M
546.63M
-
58.52M
58.52M
-
399.14M
457.66M
-
114.46M
379.87M
611.85M
222.62M
201.04M
217.58M
-
201.04M
Statement of Cash Flow
Date:
Period:
99.95M
Differed Income Tax :
-
Stock Based Compensation :
7.41M
Change in Working Capital :
- 18631.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
-
Net Cash Provided by Operating Activities:
158.74M
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
56.63M
109.86M
166.49M
-
-
-
166.49M
-
120.28M
-
-
-
-
120.28M
10.62B
10.67B
394.09M
410.00M
-
-
-
804.09M
-
3.53B
3.53B
-
4.33B
3.48M
- 445709.00K
1.7M
6.87B
March 31, 2022 at 6:00:00 AM
1.08B
6.43B
10.76B
-
410.00M
353.4M
-
- 512764.00K
- 512764.00K
-
-
-
-
369.24M
369.24M
-
15.21M
206.98M
191.77M
158.74M
- 24185.00K
134.56M
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
AMH
2023
2024
2025
2026
2027
$34.01
$35.39
$36.83
$38.33
$39.89