Arlington, Virginia-based AvalonBay Communities, Inc. (AVB) is a real estate investment trust focused on developing, acquiring, owning and operating multi-family apartment communities. With a market cap of $29.9 billion, AvalonBay operates in markets like the New York metro area, New England, Southern California, and more.
Companies worth $10 billion or more are generally classified as “large-cap stocks,” AvalonBay Communities fits right into that category, reflecting its substantial size, dominance and influence in the residential REIT industry.
Despite its strengths, AvalonBay has plunged 11.9% from its two-year high of $239.29 touched on Nov. 27, 2024. However, AVB has dipped 2.9% over the past three months, performing slightly better than the S&P 500 Index’s ($SPX) 3.3% decline during the same time frame.
While AVB stock has dropped 8.6% over the past six months, underperforming SPX’s 67 bps dip during the same time frame, it has soared 15.7% over the past 52 weeks, notably outperforming SPX’s 9.6% gains over the past year.
To confirm the bullish trend and recent downturn, AVB traded mostly above its 200-day moving average over the past year until dropping below it in recent weeks. Moreover, the stock has also traded mostly below its 50-day moving average with some fluctuations in recent months.
AvalonBay Communities’ stock dropped 1.1% in the trading session after the release of its mixed Q4 results on Feb. 5. Driven by solid rentals and other income, the company’s overall topline increased by an impressive 5.1% year-over-year to $740.5 million, however, the figure fell marginally short of the Street’s expectations. Meanwhile, driven by disciplined expense management, AvalonBay’s net income to shareholders increased 16.5% year-over-year to $282.1 million and its EPS of $1.98 surpassed the analysts’ estimates by 34.7%. Yet, its core funds from operations (FFO) per share inched up by a modest 2.2% compared to the year-ago quarter to $2.80, missing the consensus estimates by 1.1%.
Nonetheless, AvalonBay has notably outperformed its peer Equity Residential’s (EQR) 9.5% decline over the past six months and 12.1% gains over the past 52 weeks.
Among the 24 analysts covering the AVB stock, the consensus rating is a “Moderate Buy.” Its mean price target of $237.97 suggests a 12.9% upside potential from current price levels.
