Apartment Income REIT Corp. (AIRC) | Investment Case

1. Company Snapshot

1.a. Company Description

AIR is a real estate investment trust focused on the ownership and management of quality apartment communities located in the largest markets in the United States.AIR is one of the country's largest owners and operators of apartments, with 99 communities in 12 states and the District of Columbia.AIR common shares are traded on the New York Stock Exchange under the ticker symbol AIRC, and are included in the S&P 400.

For more information about AIR, please visit our website at www.aircommunities.com.

Show Full description

1.b. Last Insights on AIRC

Apartment Income REIT Corp. (AIRC) has experienced a 22.0% performance over the past 3 months, driven by a $10 billion buyout by Blackstone Inc. (BX). The company's strong financial performance, combined with the acquisition, has boosted investor confidence, leading to the stock's significant growth.

1.c. Company Highlights

Last Price	39.08
Change Percentage	-0.03%
Open	39.09
Previous Close	39.09
Market Cap ( Millions)	5671
Volume	12988662
Year High	39.1
Year Low	28.22
M A 50	38.7
M A 200	33.88

FCF Yield	6.84%
Dividend Yield	0.00%
ROE	28.17%
Debt / Equity	142.27%
Net Debt / EBIDTA	633.58%
Price To Book	2.46
Price Earnings Ratio	9.1
Price To FCF	14.62
Price To sales	6.92
EV / EBITDA	17.46

2. Transcript Summary

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3. NewsRoom

AIR Communities' Stockholders Approve Acquisition by Blackstone Real Estate

Jun -25

Source: businesswire.com

AIR Communities Announces Proxy Advisory Firm Glass Lewis Joins ISS in Recommending Stockholders Vote “FOR” Proposed Acquisition by Blackstone Real Estate

Jun -13

Source: businesswire.com

7 Small-Cap Value Stocks Leaving the S&P 500 in the Dust

Jun -12

Source: investorplace.com

AIR Communities Announces Proxy Advisory Firm ISS Recommends Stockholders Vote “FOR” Proposed Acquisition by Blackstone

Jun -12

Source: businesswire.com

Why I Buy Rental Property REITs Instead Of Rental Properties

Jun -03

Source: seekingalpha.com

Natixis Advisors L.P. Makes New Investment in Apartment Income REIT Corp. (NYSE:AIRC)

May -20

Source: https://www.defenseworld.net

The State Of REITs: May 2024 Edition

May -20

Source: seekingalpha.com

Apartment Income REIT (NYSE:AIRC) & Phillips Edison & Company, Inc. (NASDAQ:PECO) Head-To-Head Survey

May -20

Source: https://www.defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.50%)

6. Segments

Same Store

Expected Growth: 3.5%

Apartment Income REIT Corp's 3.5% same-store growth is driven by a combination of factors, including a strong US job market, increasing rents, and a low vacancy rate of 3.6%. Additionally, the company's strategic focus on high-growth markets, such as the West Coast, and its value-add renovation program also contribute to the growth.

Other Real Estate

Expected Growth: 3.8%

Apartment Income REIT Corp.'s Other Real Estate segment growth of 3.8% is driven by increasing demand for rental properties, strategic acquisitions, and effective asset management. Additionally, favorable demographic trends, such as millennials preferring renting over owning, and a strong job market, contribute to the segment's growth.

Proportionate and Other Adjustments

Expected Growth: 3.2%

The 3.2% growth in Proportionate and Other Adjustments from Apartment Income REIT Corp. is driven by increasing rental income from a strong multifamily portfolio, favorable same-store net operating income (NOI) growth, and strategic acquisitions. Additionally, effective cost management and lower interest expenses contribute to the growth, while a moderate pace of new supply and steady demand support the REIT's performance.

Corporate and Amounts Not Allocated to Segments

Expected Growth: 3.0%

Apartment Income REIT Corp's 3.0% growth is driven by strong demand for apartments, fueled by demographic trends and urbanization. Additionally, the company's strategic acquisitions, efficient operations, and favorable financing costs contribute to its growth. Furthermore, the REIT's diversified portfolio and solid balance sheet provide a foundation for sustainable growth.

7. Detailed Products

Multifamily Properties

Apartment Income REIT Corp. owns and operates a diverse portfolio of multifamily properties, offering a range of apartment homes for rent across the United States.

Lease-Up Properties

The company acquires and develops new multifamily properties, offering modern amenities and services to residents, with a focus on lease-up and stabilization.

Value-Add Properties

Apartment Income REIT Corp. acquires and renovates existing multifamily properties, enhancing their value through targeted capital improvements and operational efficiencies.

Stabilized Properties

The company owns and operates a portfolio of stabilized multifamily properties, providing a steady income stream through consistent rental revenue.

8. Apartment Income REIT Corp.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Apartment Income REIT Corp. operates in a niche market with a unique value proposition, making it difficult for substitutes to emerge.

Bargaining Power Of Customers

While customers have some bargaining power due to the availability of alternative housing options, Apartment Income REIT Corp.'s strong brand and quality of service mitigate this power.

Bargaining Power Of Suppliers

Apartment Income REIT Corp. has a diversified supplier base, reducing dependence on any one supplier and limiting their bargaining power.

Threat Of New Entrants

While there are barriers to entry in the REIT industry, new entrants can still emerge, particularly with the rise of crowdfunding and other alternative financing options.

Intensity Of Rivalry

The REIT industry is highly competitive, with many established players competing for market share and tenants.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	57.72%
Debt Cost	3.95%
Equity Weight	42.28%
Equity Cost	7.83%
WACC	5.59%
Leverage	136.50%

11. Quality Control: Apartment Income REIT Corp. passed 4 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Essex Property Trust

A-Score: 5.8/10

Value: 3.3

Growth: 5.6

Quality: 6.7

Yield: 7.0

Momentum: 3.5

Volatility: 9.0

1-Year Total Return ->

Mid-America Apartment Communities

A-Score: 5.6/10

Value: 3.2

Growth: 5.2

Quality: 5.4

Yield: 7.0

Momentum: 3.0

Volatility: 10.0

1-Year Total Return ->

Camden Property

A-Score: 5.2/10

Value: 2.1

Growth: 4.2

Quality: 5.0

Yield: 7.0

Momentum: 3.0

Volatility: 10.0

1-Year Total Return ->

Independence Realty Trust

A-Score: 5.2/10

Value: 2.6

Growth: 5.8

Quality: 4.2

Yield: 7.0

Momentum: 2.5

Volatility: 9.0

1-Year Total Return ->

UDR

A-Score: 5.2/10

Value: 2.2

Growth: 3.9

Quality: 4.5

Yield: 8.0

Momentum: 2.5

Volatility: 10.0

1-Year Total Return ->

Apartment Income REIT

A-Score: 4.4/10

Value: 4.4

Growth: 4.3

Quality: 5.4

Yield: 4.0

Momentum: 5.0

Volatility: 3.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

1.14%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

5.59%

Apartment Income REIT Corp. - US03750L1098

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on AIRC

1.c. Company Highlights

Expensive

Stable Momentum

Average Quality

Earnings Miss

Fairly Valued

Strong Momentum

Medium Volatility

Earnings Beats

Average Yield

Average Growth

Lower Quality

More Volatile

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.50%)

6. Segments

Same Store

Expected Growth: 3.5%

Other Real Estate

Expected Growth: 3.8%

Proportionate and Other Adjustments

Expected Growth: 3.2%

Corporate and Amounts Not Allocated to Segments

Expected Growth: 3.0%

7. Detailed Products

Multifamily Properties

Lease-Up Properties

Value-Add Properties

Stabilized Properties

8. Apartment Income REIT Corp.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Apartment Income REIT Corp. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

39.08$

Current Price

39.08$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA