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Equity Residential: Stock Trading In Value Territory

Apr. 27, 2023 8:15 AM ETEquity Residential (EQR)9 Comments


  • Equity Residential recently closed out another strong first quarter with robust top and bottom line growth.
  • Most of Equity Residential's markets have median home price to median household income ratios that are well above the national median.
  • EQR stock is materially down from a year ago and trades far below its normal valuation, giving investors the potential for strong total returns.
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Money and investment concept


It's no surprise that many real estate investment trusts, or REITs (VNQ), have fallen since the start of the year. Renewed concerns around commercial real estate have resurfaced in light of recent blow-ups of regional banks, including Silicon Valley Bank (

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I am Gen Alpha. I have more than 14 years of investment experience, and an MBA in Finance. I focus on stocks that are more defensive in nature, with a medium- to long-term horizon.

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Analyst’s Disclosure: I/we have a beneficial long position in the shares of EQR either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (9)

It seems the Gen Alpha author is disinterested in replying to a legitimate inquiry:

Why not MAA which also has an A- rating, has a lower debt to EBITDAre ratio of 3.7%X, lower average interest rate of 3.4%, and staggered debt maturities, strong balance sheet with $1.3B in cash, also strong FFO, same store, and NOI growth?

Although MAA pays a slightly lower dividend yield of 3.6% with a favorable 62% POR and 7% CAGR.
BubbleGardener profile picture
@grcinak He just gave you a free article. Who are you to demand he respond to your question?
The self righteous entitlement knows no limits with you people
@BubbleGardener CNBC is free too. Long live "Cramer-merica."

I demand nothing, rather point that G.A. issues daily articles, some days multiple articles, and should one care look through the history of the voluminous G.A. articles they are > 95% buy recommendations with little in-depth analysis, and no follow up. Nothing more than billboards, IMO. As for being free, I do rather enjoy the stimuli, while understanding it is exactly worth what I paid for it.

Comparatively, I hold in great regard those S.A. "analysts" who publish their analytical work, and then interact with their followers challenges. YMMV.
Ghentite profile picture
After a few months, I am finally in the green with EQR. I like that they have a large presence in northern Virginia, DC, and Maryland. Their property in Maryland were always much less than the BAH amount I received when I was stationed there. They lacked some of the amenities that Avalon Bay and Bozzuto offered so I never became one of Equity Residential's tenants. Their ability to attract the large military and federal workforce population makes it a good stock pick for me.
Why not MAA which also has an A- rating, has a lower debt to EBITDAre ratio of 3.7%X, lower average interest rate of 3.4%, and staggered debt maturities, strong balance sheet with $1.3B in cash, also strong FFO, same store, and NOI growth?

Although MAA pays a slightly lower dividend yield of 3.6% with a favorable 62% POR and 7% CAGR.
Yes, EQR (and AVB) appear to be undervalued. On the earnings call EQR said cap rates are now 5-5.25% for similar high quality apartments. Historically these stocks trade at a slight premium, presumably reflecting the benefits of liquidity and management, yet today the FFO yield is 6.25% meaning it is significantly cheaper to buy the stock than to buy a comparable apartment. I am long both.
BubbleGardener profile picture
@ccking3 Excellent comment and I'm seeing the same thing when comparing the liquid vs illiquid vehicles. This makes sense as there's greater price discovery in the publicly traded REITs. I suspect that apt buildings will come it to reflect the new pricing
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