Apartment Investment and Management (NYSE:AIV) and KKR Real Estate Finance Trust (NYSE:KREF) Head-To-Head Comparison

Apartment Investment and Management (NYSE:AIV) and KKR Real Estate Finance Trust (NYSE:KREF) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, risk, valuation, earnings, profitability and institutional ownership.

Earnings & Valuation

This table compares Apartment Investment and Management and KKR Real Estate Finance Trust”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Apartment Investment and Management	$208.68 million	5.95	-$166.20 million	($0.74)	-11.82
KKR Real Estate Finance Trust	$155.17 million	4.83	$35.59 million	$0.18	60.58

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.

Insider and Institutional Ownership

83.3% of Apartment Investment and Management shares are held by institutional investors. Comparatively, 70.2% of KKR Real Estate Finance Trust shares are held by institutional investors. 3.0% of Apartment Investment and Management shares are held by insiders. Comparatively, 1.9% of KKR Real Estate Finance Trust shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

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%

Volatility and Risk

Apartment Investment and Management has a beta of 1.4, indicating that its stock price is 40% more volatile than the S&P 500. Comparatively, KKR Real Estate Finance Trust has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings 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

KKR Real Estate Finance Trust has a consensus target price of $12.46, indicating a potential upside of 14.24%. Given KKR Real Estate Finance Trust’s stronger consensus rating and higher possible upside, analysts plainly believe KKR Real Estate Finance Trust is more favorable than Apartment Investment and Management.

Dividends

Apartment Investment and Management pays an annual dividend of $1.01 per share and has a dividend yield of 11.5%. KKR Real Estate Finance Trust pays an annual dividend of $1.00 per share and has a dividend yield of 9.2%. 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.

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.