Douglas Emmett (NYSE:DEI) and Apollo Commercial Real Estate Finance (NYSE:ARI) Head-To-Head Survey

Douglas Emmett (NYSE:DEI) and Apollo Commercial Real Estate Finance (NYSE:ARI) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, analyst recommendations, risk, dividends, earnings, institutional ownership and profitability.

Risk & Volatility

Douglas Emmett has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500. Comparatively, Apollo Commercial Real Estate Finance has a beta of 1.76, indicating that its stock price is 76% more volatile than the S&P 500.

Institutional and Insider Ownership

97.4% of Douglas Emmett shares are owned by institutional investors. Comparatively, 54.4% of Apollo Commercial Real Estate Finance shares are owned by institutional investors. 14.7% of Douglas Emmett shares are owned by insiders. Comparatively, 0.7% of Apollo Commercial Real Estate Finance shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Dividends

Douglas Emmett pays an annual dividend of $0.76 per share and has a dividend yield of 4.4%. Apollo Commercial Real Estate Finance pays an annual dividend of $1.00 per share and has a dividend yield of 10.4%. Douglas Emmett pays out -245.2% of its earnings in the form of a dividend. Apollo Commercial Real Estate Finance pays out -128.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Profitability

This table compares Douglas Emmett and Apollo Commercial Real Estate Finance’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Douglas Emmett	-3.55%	-0.88%	-0.35%
Apollo Commercial Real Estate Finance	7.30%	9.12%	2.09%

Analyst Recommendations

This is a breakdown of current recommendations for Douglas Emmett and Apollo Commercial Real Estate Finance, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Douglas Emmett	0	7	1	0	2.13
Apollo Commercial Real Estate Finance	1	4	0	0	1.80

Douglas Emmett currently has a consensus price target of $15.88, indicating a potential downside of 7.86%. Apollo Commercial Real Estate Finance has a consensus price target of $10.25, indicating a potential upside of 6.22%. Given Apollo Commercial Real Estate Finance’s higher probable upside, analysts clearly believe Apollo Commercial Real Estate Finance is more favorable than Douglas Emmett.

Valuation and Earnings

This table compares Douglas Emmett and Apollo Commercial Real Estate Finance”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Douglas Emmett	$1.01 billion	2.87	-$42.71 million	($0.31)	-55.58
Apollo Commercial Real Estate Finance	$332.85 million	4.12	$58.13 million	($0.78)	-12.37

Apollo Commercial Real Estate Finance has lower revenue, but higher earnings than Douglas Emmett. Douglas Emmett is trading at a lower price-to-earnings ratio than Apollo Commercial Real Estate Finance, indicating that it is currently the more affordable of the two stocks.

Summary

Apollo Commercial Real Estate Finance beats Douglas Emmett on 9 of the 16 factors compared between the two stocks.

About Douglas Emmett

Douglas Emmett, Inc. (DEI) is a fully integrated, self-administered and self-managed real estate investment trust (REIT), and one of the largest owners and operators of high-quality office and multifamily properties located in the premier coastal submarkets of Los Angeles and Honolulu. Douglas Emmett focuses on owning and acquiring a substantial share of top-tier office properties and premier multifamily communities in neighborhoods that possess significant supply constraints, high-end executive housing and key lifestyle amenities.

About Apollo Commercial Real Estate Finance

Apollo Commercial Real Estate Finance, Inc. operates as a real estate investment trust (REIT) that originates, acquires, invests in, and manages commercial first mortgage loans, subordinate financings, and other commercial real estate-related debt investments in the United States, the United Kingdom, and Europe. It is qualified as a REIT under the Internal Revenue Code. As a REIT, it would not be subject to federal income taxes, if the company distributes at least 90% of its REIT taxable income to its stockholders. Apollo Commercial Real Estate Finance, Inc. was incorporated in 2009 and is based in New York, New York.