Apollo Commercial Real Estate Finance (NYSE:ARI – Get Free Report) and Douglas Emmett (NYSE:DEI – Get Free Report) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, dividends, valuation and analyst recommendations.
Institutional & Insider Ownership
54.4% of Apollo Commercial Real Estate Finance shares are owned by institutional investors. Comparatively, 97.4% of Douglas Emmett shares are owned by institutional investors. 0.7% of Apollo Commercial Real Estate Finance shares are owned by company insiders. Comparatively, 14.7% of Douglas Emmett shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Analyst Ratings
This is a breakdown of recent ratings for Apollo Commercial Real Estate Finance and Douglas Emmett, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Apollo Commercial Real Estate Finance | 1 | 4 | 0 | 0 | 1.80 |
| Douglas Emmett | 0 | 7 | 1 | 0 | 2.13 |
Earnings and Valuation
This table compares Apollo Commercial Real Estate Finance and Douglas Emmett”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Apollo Commercial Real Estate Finance | $332.85 million | 4.12 | $58.13 million | ($0.78) | -12.37 |
| Douglas Emmett | $1.01 billion | 2.81 | -$42.71 million | ($0.31) | -54.52 |
Apollo Commercial Real Estate Finance has higher earnings, but lower revenue 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.
Dividends
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 an annual dividend of $0.76 per share and has a dividend yield of 4.5%. Apollo Commercial Real Estate Finance pays out -128.2% of its earnings in the form of a dividend. Douglas Emmett pays out -245.2% 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 Apollo Commercial Real Estate Finance and Douglas Emmett’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Apollo Commercial Real Estate Finance | 7.30% | 9.12% | 2.09% |
| Douglas Emmett | -3.55% | -0.88% | -0.35% |
Risk and Volatility
Apollo Commercial Real Estate Finance has a beta of 1.76, suggesting that its share price is 76% more volatile than the S&P 500. Comparatively, Douglas Emmett has a beta of 1.1, suggesting that its share price is 10% more volatile than the S&P 500.
Summary
Apollo Commercial Real Estate Finance beats Douglas Emmett on 9 of the 16 factors compared between the two stocks.
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.
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.
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