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Invitation Homes Inc (INVH)
NYSE:INVH
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Invitation Homes
(NYSE:INVH)70Outperform
Positive Factors
Managed Home Business Growth
The growth in INVH's managed home business is encouraging, with 4Q managed fee revenue surpassing estimates.
Seasonal Leasing Advantage
INVH is well-positioned to push rate into the Spring leasing season and benefit from a normal expected seasonal curve.
Negative Factors
Comparison with Peers
INVH's top-line growth is projected to be lower than its peer AMH, which is preferred due to stronger growth and a more diversified portfolio.
Invitation Homes (INVH) vs. S&P 500 (SPY)
Market Cap
$20.76B
Dividend Yield3.32%
Average Volume (3M)2.87M
Price to Earnings (P/E)99.7
Beta (1Y)0.94
Revenue Growth8.16%
EPS Growth-37.84%
CountryUS
Employees1,555
SectorReal Estate
Sector Strength72
IndustryREITs
Share Statistics
EPS (TTM)0.34
Shares Outstanding612,689,600
10 Day Avg. Volume3,630,638
30 Day Avg. Volume2,872,648
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)7.93
Price to Cash Flow (P/CF)39.10
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$35.85Price Target Upside5.22% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering15
Invitation Homes Business Overview & Revenue Model
Company DescriptionInvitation Homes (INVH) is a leading real estate company in the United States specializing in the acquisition, renovation, leasing, and management of single-family homes. The company operates within the residential real estate sector, providing high-quality homes for lease in desirable neighborhoods across the country. By focusing on creating a seamless and reliable rental experience, Invitation Homes aims to meet the growing demand for single-family rental properties while offering residents a superior living experience.
How the Company Makes MoneyInvitation Homes generates revenue primarily through the leasing of its portfolio of single-family homes. The company collects rental income from tenants who lease these properties, which serves as its main revenue stream. Additionally, Invitation Homes may earn ancillary income from services provided to tenants, such as maintenance and repair services. The company's ability to generate income is further supported by strategic acquisitions of homes in markets with high demand for rental properties, ensuring a steady flow of rental income. Partnerships with local real estate experts and investment in technology to streamline operations and enhance tenant satisfaction also contribute to their revenue-generating capabilities.
Invitation Homes Financial Statement Overview
Summary
Invitation Homes exhibits strong growth and efficient operations with high EBIT and EBITDA margins. While revenue and gross profit margins have improved, net profit margin has slightly decreased, which warrants attention. The balance sheet reflects moderate leverage and solid equity, though high debt levels could be a concern. Cash flow generation is robust, but improving free cash flow conversion would enhance financial flexibility.Income Statement
Invitation Homes has shown a consistent revenue growth with a 7.65% increase from 2023 to 2024. The gross profit margin improved to 64.28% in 2024 from 59.86% in 2023, indicating effective cost management. However, the net profit margin decreased slightly to 17.34% in 2024 from 21.37% in 2023, suggesting increased expenses or other costs impacting net income. Strong EBIT and EBITDA margins of 60.83% and 88.07% respectively highlight robust operational efficiency.85
Very Positive
Balance Sheet
The debt-to-equity ratio stood at 0.84 in 2023, reflecting moderate leverage. The return on equity was 5.11% in 2023, indicating modest profitability relative to shareholder's equity. The equity ratio was 52.85%, demonstrating a solid equity base compared to total assets. However, high debt levels could pose risks during economic downturns.70
Positive
Cash Flow
The free cash flow grew by 7.82% from 2022 to 2023, showing healthy cash generation. The operating cash flow to net income ratio was 2.13 in 2023, indicating strong cash conversion from earnings. However, the free cash flow to net income ratio of 1.71 suggests efficient capital expenditure management but could be improved for better flexibility.75
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.62B | 2.43B | 2.23B | 2.00B | 1.82B | Gross Profit |
| 1.68B | 1.46B | 1.35B | 1.22B | 1.08B | EBIT |
| 1.59B | 1.47B | 642.40M | 550.42M | 468.44M | EBITDA |
| 1.54B | 1.44B | 2.02B | 1.81B | 1.63B | Net Income Common Stockholders |
| 453.92M | 519.47M | 383.33M | 261.43M | 196.21M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 174.49M | 700.62M | 262.87M | 610.17M | 213.42M | Total Assets |
| 18.70B | 19.22B | 18.54B | 18.54B | 17.51B | Total Debt |
| 8.20B | 8.55B | 7.77B | 8.00B | 8.03B | Net Debt |
| 8.03B | 7.85B | 7.51B | 7.39B | 7.82B | Total Liabilities |
| 8.91B | 9.03B | 8.21B | 8.70B | 8.95B | Stockholders Equity |
| 9.76B | 10.16B | 10.29B | 9.80B | 8.50B |
| Cash Flow | Free Cash Flow | |||
| 862.41M | 885.99M | 815.52M | 744.83M | 524.43M | Operating Cash Flow |
| 1.08B | 1.11B | 1.02B | 907.66M | 696.71M | Investing Cash Flow |
| -465.87M | -773.55M | -814.41M | -1.16B | -425.16M | Financing Cash Flow |
| -1.09B | 110.02M | -574.11M | 658.99M | -146.03M |
Invitation Homes Technical Analysis
Positive
34.07
Price Trends
31.70
Positive
32.44
Positive
33.62
Positive
Market Momentum
0.66
Negative
63.53
Neutral
79.61
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For INVH, the sentiment is Positive. The current price of 34.07 is above the 20-day moving average (MA) of 32.40, above the 50-day MA of 31.70, and above the 200-day MA of 33.62, indicating a bullish trend. The MACD of 0.66 indicates Negative momentum. The RSI at 63.53 is Neutral, neither overbought nor oversold. The STOCH value of 79.61 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for INVH.
Invitation Homes Risk Analysis
Invitation Homes disclosed 70 risk factors in its most recent earnings report. Invitation Homes reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Invitation Homes Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $31.72B | 29.36 | 9.10% | 3.03% | 4.85% | 16.04% | |
78 Outperform | $28.73B | 27.03 | 9.36% | 3.68% | 3.80% | 24.08% | |
75 Outperform | $13.47B | 33.73 | 5.82% | 2.86% | 6.28% | 7.07% | |
70 Outperform | $20.76B | 99.68 | 4.67% | 3.32% | 8.16% | -37.84% | |
69 Neutral | $13.16B | 82.06 | 3.38% | 3.34% | 0.55% | -59.48% | |
61 Neutral | $4.91B | 18.99 | -3.12% | 7.77% | 6.71% | -19.69% | |
61 Neutral | $20.17B | 37.49 | 8.73% | 3.48% | 1.98% | -4.78% |
* Real Estate Sector Average
Performance Comparison
INVH
Invitation Homes
33.79
0.31
0.93%
AVB
AvalonBay
218.50
39.49
22.06%
EQR
Equity Residential
71.91
11.37
18.78%
MAA
Mid-America Apartment
166.77
39.46
31.00%
CPT
Camden Property
121.82
26.69
28.06%
AMH
American Homes
36.07
0.55
1.55%
Invitation Homes Earnings Call Summary
Earnings Call Date: Feb 26, 2025 | % Change Since: 7.92% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Neutral
Invitation Homes reported strong financial and operational performance for 2024, with significant growth in managed home count and strategic capital allocation. However, challenges in specific markets due to supply pressures and the impact of new home deliveries were noted. The company remains cautiously optimistic for 2025, with measured guidance reflecting these market conditions.Highlights
Strong Financial Performance in 2024
Invitation Homes reported solid execution across its platform with core FFO per share growth of 6.4% and AFFO per share growth of 6.7% for the full year 2024. The company also achieved a same-store NOI margin of over 68%.
Operational Efficiency and Growth
The company reported a 4.7% year-over-year growth in NOI for the fourth quarter, driven by core revenue growth of 2.7% and a reduction in core operating expenses by 1.5%. The property tax expense growth returned to a more normal rate of 5.8%.
Expansion of Managed Home Count
Invitation Homes grew its JV and third-party managed home count by more than six and a half times to over 25,000 homes in 2024. The pipeline of homes under development remains robust, with more than 2,000 homes under development.
Strategic Capital Allocation
The company maintained a strong balance sheet with nearly $1.4 billion in liquidity and a net debt to adjusted EBITDA ratio of 5.3 times, below the target range.
Positive Market Trends and Demand
Average length of stay was approximately 38 months with a renewal rate of 80% and same-store rental rate growth on renewals of 4.2% year over year. The company sees continued demand for leasing single-family homes, with the average cost of leasing about $1,100 cheaper than owning.
Lowlights
Challenges in Specific Markets
The company noted supply challenges in Central Florida, Texas, and Phoenix, affecting leasing performance. New lease rate growth was negative 2.2% for new leases in the fourth quarter.
Impact of New Home Deliveries
The company is seeing moderating impacts from new home deliveries, which continue to affect some markets. There are concerns about potential tariffs and prolonged higher mortgage rates impacting the market.
Lower Guidance for 2025
Guidance for 2025 anticipates lower same-store NOI growth in a range of 1% to 3%, reflecting cautious expectations due to market conditions and supply pressures.
Company Guidance
During the call, Invitation Homes provided guidance for fiscal year 2025, highlighting several key metrics and strategic initiatives. The company expects core funds from operations (FFO) per share to range between $1.88 and $1.94, while adjusted FFO (AFFO) per share is anticipated to be between $1.58 and $1.64. Same-store net operating income (NOI) growth is projected to be between 1% and 3%. The company plans to execute $600 million in wholly-owned acquisitions, offset by $500 million in dispositions, emphasizing capital recycling from older assets into new investments. They reported a year-end 2024 net debt to adjusted EBITDA ratio of 5.3 times, maintaining a robust liquidity position of nearly $1.4 billion. Additionally, Invitation Homes observed strong operational performance, with a renewal rate of 80% and same-store rental rate growth of 4.2% year over year. The company plans to capitalize on its strategic partnerships, expecting over 2,000 homes under development, and aims to enhance scale and density within core markets.Invitation Homes Corporate Events
Business Operations and StrategyFinancial Disclosures
Invitation Homes Reports Strong Start to 2025
Positive
Feb 28, 2025
Invitation Homes Inc. reported preliminary results for January-February 2025, showing growth in renewal and blended lease rates, with occupancy improving to 97.1%. The company anticipates steady growth in 2025, supported by strategic acquisitions and partnerships, aiming for a return to normal occupancy levels and continued expansion in its core markets.
Executive/Board ChangesBusiness Operations and Strategy
Invitation Homes Promotes Timothy Lobner to COO
Positive
Feb 25, 2025
On February 21, 2025, Invitation Homes announced the promotion of Timothy Lobner to Executive Vice President and Chief Operating Officer, effective March 2, 2025. This leadership change aims to strengthen the company’s operations and strategic focus, with Charles Young continuing as President. The announcement also included updates on executive compensation, reflecting the company’s performance in 2024, with increased long-term incentive awards for key executives. These changes are part of Invitation Homes’ efforts to ensure leadership continuity and business success, impacting stakeholders by potentially enhancing operational efficiency and strategic growth.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.