Analysts Conflicted on These Financial Names: American Homes (NYSE: AMH), Apple Hospitality REIT (NYSE: APLE) and Hercules Capital (NYSE: HTGC)

By Carrie Williams

Analysts have been eager to weigh in on the Financial sector with new ratings on American Homes (NYSE: AMH), Apple Hospitality REIT (NYSE: APLE) and Hercules Capital (NYSE: HTGC).

American Homes (NYSE: AMH)

In a report released today, David Corak from B.Riley FBR maintained a Buy rating on American Homes (NYSE: AMH), with a price target of $26. The company’s shares closed yesterday at $19.40.

Corak wrote:

“American Homes 4 Rent (AMH) completed a transformative year in 2017, growing the portfolio prudently, securing an investment grade rating, issuing an inaugural unsecured note, and improving most relevant portfolio metrics. As such, we will start with the positives in 4Q. During the quarter, core FFO was in line with consensus, renewals were strong at +4.2%, platform efficiency improved 100 bps Y/Y , and the company gave formal written guidance for the first time, which is a strong step forward. However, revenue growth came in slightly below the low end of FY guidance (2.96% vs. 3.25%), which had been revised downward in November due to hurricanes amongst other items. AMH thereby missed the implied 4Q rev guide by about 115 bps. This was offset primarily by property taxes that came in 80 bps lower than expected for FY17.”

According to TipRanks.com, Corak is ranked 0 out of 5 stars with an average return of -3.8% and a 34.6% success rate. Corak covers the Financial sector, focusing on stocks such as National Storage Affiliates Trust, Preferred Apartment Communities, and NorthStar Realty Europe Corp.

American Homes has an analyst consensus of Strong Buy, with a price target consensus of $26.25.

Apple Hospitality REIT (NYSE: APLE)

In a report released today, Bryan Maher from B.Riley FBR maintained a Hold rating on Apple Hospitality REIT (NYSE: APLE), with a price target of $20. The company’s shares closed yesterday at $17.92, close to its 52-week low of $17.49.

Maher said:

“Apple Hospitality REIT (APLE) posted 4Q17 results with adjusted EBITDA coming in at $93.1M, in line with the consensus estimate and just below our estimate of $93.6M. MFFO/share was $0.36, also in line with our estimate and consensus. Driving results was 3.5% RevPAR growth at comparable hotels, up nicely from the 1.3% reported in 3Q17. Transaction activity continued at a modest pace, with three hotels (750 rooms) acquired in 4Q17 for $106.0M, while the REIT sold one full-service hotel (316 rooms) for $42.0M. While RevPAR strength was solid across chain scales, Apple’s five upper upscale hotels reported strong RevPAR growth of 10.3%. Regionally, the West South Central (+5.6%), New England (+5.2%) and the Pacific (+5.1%) were the strongest markets for Apple Hospitality. By location, the REIT’s suburban hotels were the strongest with RevPAR of 5.0%.”

According to TipRanks.com, Maher is a 1-star analyst with an average return of -0.7% and a 43.0% success rate. Maher covers the Financial sector, focusing on stocks such as Government Properties Income Trust, Senior Housing Properties Trust, and Retail Opportunity Investments.

Apple Hospitality REIT has an analyst consensus of Moderate Buy, with a price target consensus of $20.67.

Hercules Capital (NYSE: HTGC)

B.Riley FBR analyst Timothy Hayes reiterated a Buy rating on Hercules Capital (NYSE: HTGC) today and set a price target of $15. The company’s shares closed yesterday at $12.41.

Hayes wrote:

“We reiterate our Buy rating and $15.00 price target on shares of Hercules Capital (HTGC), following 4Q17 results that beat our expectations and consisted of strong portfolio growth, stable core yields, and forward commentary that suggests a secure dividend over the coming quarters. During the quarter, Hercules completed a large accretive portfolio acquisition and an investment-grade bond offering, of which the proceeds were (and we expect will be) used to redeem more expensive debt. While elevated prepayment levels and portfolio repositioning are expected to present headwinds to growth in the first half of 2018, we view Hercules as well positioned to grow earnings in 2H18, given the company’s strong balance sheet and liquidity position, a robust forward pipeline, and a lower weighted-average funding cost (with the potential to go lower).”

According to TipRanks.com, Hayes is ranked #3569 out of 4750 analysts.

Hercules Capital has an analyst consensus of Strong Buy, with a price target consensus of $14.08.

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