Stock of the Day

September 21, 2022

Equity Residential (EQR)

$71.56
-$0.11 (-0.1%)
Market Cap: $27.21B

About Equity Residential

Equity Residential is committed to creating communities where people thrive. The Company, a member of the S&P 500, is focused on the acquisition, development and management of residential properties located in and around dynamic cities that attract affluent long-term renters. Equity Residential owns or has investments in 305 properties consisting of 80,683 apartment units, with an established presence in Boston, New York, Washington, D.C., Seattle, San Francisco and Southern California, and an expanding presence in Denver, Atlanta, Dallas/Ft. Worth and Austin.

Equity Residential Bull Case

Here are some ways that investors could benefit from investing in Equity Residential:

  • The current stock price is $71.23, which may present a buying opportunity for investors looking for value in the real estate sector.
  • Equity Residential has a strong market capitalization of $27.03 billion, indicating a solid position in the market and potential for growth.
  • The company recently announced a quarterly dividend of $0.675, resulting in an annualized dividend yield of 3.79%, which can provide a steady income stream for investors.
  • Analysts have a consensus rating of "Hold" with a price target of $78.42, suggesting that there is potential for price appreciation in the near term.
  • Recent upgrades from analysts, such as Stifel Nicolaus raising their rating to "buy" and increasing the price target to $81.50, indicate positive sentiment and confidence in the company's future performance.

Equity Residential Bear Case

Investors should be bearish about investing in Equity Residential for these reasons:

  • The company has a high dividend payout ratio of 99.26%, which may raise concerns about sustainability and the ability to maintain dividends in the long term.
  • Insider selling activity has been notable, with executives selling a total of 19,763 shares valued at $1,424,217 in the last 90 days, which could signal a lack of confidence in the company's short-term prospects.
  • The stock has experienced a decrease in price targets from several analysts, including Barclays and Wells Fargo, which may indicate a bearish outlook on the stock's performance.
  • Equity Residential's debt-to-equity ratio of 0.72 suggests a moderate level of debt, which could pose risks in a rising interest rate environment.
  • The stock has a relatively high P/E ratio of 26.19, which may indicate that it is overvalued compared to its earnings, making it less attractive for value-focused investors.

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