Financial Analysis: Corporación Inmobiliaria Vesta (NYSE:VTMX) vs. Armada Hoffler Properties (NYSE:AHH)

Corporación Inmobiliaria Vesta (NYSE:VTMX) and Armada Hoffler Properties (NYSE:AHH) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, valuation, earnings, profitability, analyst recommendations, dividends and risk.

Profitability

This table compares Corporación Inmobiliaria Vesta and Armada Hoffler Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Corporación Inmobiliaria Vesta	164.44%	15.40%	10.25%
Armada Hoffler Properties	-1.01%	-1.18%	-0.30%

Dividends

Corporación Inmobiliaria Vesta pays an annual dividend of $0.15 per share and has a dividend yield of 0.6%. Armada Hoffler Properties pays an annual dividend of $0.82 per share and has a dividend yield of 7.5%. Corporación Inmobiliaria Vesta pays out 3.4% of its earnings in the form of a dividend. Armada Hoffler Properties pays out -390.5% 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. Armada Hoffler Properties is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Corporación Inmobiliaria Vesta and Armada Hoffler Properties, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Corporación Inmobiliaria Vesta	0	1	1	0	2.50
Armada Hoffler Properties	0	1	1	0	2.50

Corporación Inmobiliaria Vesta presently has a consensus target price of $33.50, suggesting a potential upside of 32.57%. Armada Hoffler Properties has a consensus target price of $11.88, suggesting a potential upside of 8.25%. Given Corporación Inmobiliaria Vesta’s higher probable upside, equities analysts clearly believe Corporación Inmobiliaria Vesta is more favorable than Armada Hoffler Properties.

Insider and Institutional Ownership

6.6% of Corporación Inmobiliaria Vesta shares are owned by institutional investors. Comparatively, 66.4% of Armada Hoffler Properties shares are owned by institutional investors. 11.9% of Armada Hoffler Properties shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Risk and Volatility

Corporación Inmobiliaria Vesta has a beta of 1.16, indicating that its share price is 16% more volatile than the S&P 500. Comparatively, Armada Hoffler Properties has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500.

Earnings and Valuation

This table compares Corporación Inmobiliaria Vesta and Armada Hoffler Properties”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Corporación Inmobiliaria Vesta	$214.47 million	101.79	$316.64 million	$4.42	5.72
Armada Hoffler Properties	$667.16 million	1.67	$8.29 million	($0.21)	-52.24

Corporación Inmobiliaria Vesta has higher earnings, but lower revenue than Armada Hoffler Properties. Armada Hoffler Properties is trading at a lower price-to-earnings ratio than Corporación Inmobiliaria Vesta, indicating that it is currently the more affordable of the two stocks.

Summary

Corporación Inmobiliaria Vesta beats Armada Hoffler Properties on 9 of the 14 factors compared between the two stocks.

About Corporación Inmobiliaria Vesta

Corporación Inmobiliaria Vesta, S.A.B. de C.V., together with its subsidiaries, acquires, develops, manages, operates, and leases industrial buildings and distribution facilities in Mexico. The company was incorporated in 1998 and is headquartered in Mexico City, Mexico.

About Armada Hoffler Properties

Armada Hoffler Properties, Inc. (the “Company”) is a vertically integrated, self-managed real estate investment trust (“REIT”) with over four decades of experience developing, building, acquiring, and managing high-quality retail, office, and multifamily properties located primarily in the Mid-Atlantic and Southeastern United States. In addition to the ownership of the Company’s operating property portfolio, the Company develops and builds properties for its own account and through joint ventures between the Company and unaffiliated partners and also invests in development projects through real estate financing arrangements. The Company also provides general construction and development services to third-party clients. The Company’s construction and development experience includes mid- and high-rise office buildings, retail strip malls, retail power centers, multifamily apartment communities, hotels and conference centers, single- and multi-tenant industrial, distribution, and manufacturing facilities, educational, medical, and special purpose facilities, government projects, parking garages, and mixed-use town centers. The Company is the sole general partner of Armada Hoffler, L.P. (the “Operating Partnership”) and, as of March 31, 2024, owned 75.5% of the economic interest in the Operating Partnership, of which 0.1% is held as general partnership units. The operations of the Company are conducted primarily through the Operating Partnership and the wholly owned subsidiaries thereof.