Critical Survey: Camden Property Trust (NYSE:CPT) and Invesco Mortgage Capital (NYSE:IVR)

Camden Property Trust (NYSE:CPT) and Invesco Mortgage Capital (NYSE:IVR) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, profitability, earnings, valuation, analyst recommendations, risk and institutional ownership.

Valuation & Earnings

This table compares Camden Property Trust and Invesco Mortgage Capital”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Camden Property Trust	$1.54 billion	8.29	$403.31 million	$3.16	37.94
Invesco Mortgage Capital	$277.93 million	1.80	-$15.86 million	$1.20	6.85

Camden Property Trust has higher revenue and earnings than Invesco Mortgage Capital. Invesco Mortgage Capital is trading at a lower price-to-earnings ratio than Camden Property Trust, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Camden Property Trust has a beta of 0.91, suggesting that its stock price is 9% less volatile than the S&P 500. Comparatively, Invesco Mortgage Capital has a beta of 1.9, suggesting that its stock price is 90% more volatile than the S&P 500.

Dividends

Camden Property Trust pays an annual dividend of $4.12 per share and has a dividend yield of 3.4%. Invesco Mortgage Capital pays an annual dividend of $1.60 per share and has a dividend yield of 19.5%. Camden Property Trust pays out 130.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Invesco Mortgage Capital pays out 133.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Insider and Institutional Ownership

97.2% of Camden Property Trust shares are held by institutional investors. Comparatively, 40.5% of Invesco Mortgage Capital shares are held by institutional investors. 1.8% of Camden Property Trust shares are held by company insiders. Comparatively, 0.2% of Invesco Mortgage Capital shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Camden Property Trust and Invesco Mortgage Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Camden Property Trust	22.32%	6.97%	3.78%
Invesco Mortgage Capital	30.67%	36.90%	3.50%

Analyst Ratings

This is a summary of current recommendations and price targets for Camden Property Trust and Invesco Mortgage Capital, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Camden Property Trust	0	15	4	0	2.21
Invesco Mortgage Capital	0	2	1	0	2.33

Camden Property Trust currently has a consensus target price of $122.50, suggesting a potential upside of 2.18%. Invesco Mortgage Capital has a consensus target price of $9.00, suggesting a potential upside of 9.42%. Given Invesco Mortgage Capital’s stronger consensus rating and higher probable upside, analysts clearly believe Invesco Mortgage Capital is more favorable than Camden Property Trust.

Summary

Camden Property Trust beats Invesco Mortgage Capital on 10 of the 16 factors compared between the two stocks.

About Camden Property Trust

Camden Property Trust, an S&P 500 Company, is a real estate company primarily engaged in the ownership, management, development, redevelopment, acquisition, and construction of multifamily apartment communities. Camden owns and operates 172 properties containing 58,250 apartment homes across the United States. Upon completion of 5 properties currently under development, the Company’s portfolio will increase to 59,996 apartment homes in 177 properties. Camden has been recognized as one of the 100 Best Companies to Work For by FORTUNE magazine for 17 consecutive years, most recently ranking #24.

About Invesco Mortgage Capital

Invesco Mortgage Capital Inc. operates as a real estate investment trust (REIT) that invests, finances, and manages mortgage-backed securities and other mortgage-related assets in the United States. It invests in residential mortgage-backed securities (RMBS) and commercial mortgage-backed securities (CMBS) that are guaranteed by a U.S. government agency or federally chartered corporation; RMBS and CMBS that are not issued or guaranteed by the United States government agency or federally chartered corporation; the United States treasury securities; real estate-related financing arrangements; to-be-announced securities forward contracts to purchase RMBS; and commercial mortgage loans. It has elected to be taxed as a REIT and would be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was incorporated in 2008 and is headquartered in Atlanta, Georgia.