Equity Residential (EQR): Today's Featured Real Estate Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Equity Residential ( EQR) pushed the Real Estate industry lower today making it today's featured Real Estate laggard. The industry as a whole closed the day up 0.7%. By the end of trading, Equity Residential fell 95 cents (-1.7%) to $55.04 on heavy volume. Throughout the day, 3.4 million shares of Equity Residential exchanged hands as compared to its average daily volume of two million shares. The stock ranged in price between $55.02-$56.18 after having opened the day at $56 as compared to the previous trading day's close of $55.99. Other companies within the Real Estate industry that declined today were: Impac Mortgage Holdings ( IMH), down 25.5%, InnSuites Hospitality ( IHT), down 5%, American Realty Capital Properties ( ARCP), down 4.8%, and BRT Realty ( BRT), down 4%.
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Equity Residential, a real estate investment trust (REIT), engages in the acquisition, development, and management of multifamily properties in the United States. Equity Residential has a market cap of $18.23 billion and is part of the financial sector. The company has a P/E ratio of 60.9, above the S&P 500 P/E ratio of 17.7. Shares are down 1.2% year to date as of the close of trading on Wednesday. Currently there are five analysts that rate Equity Residential a buy, one analyst rates it a sell, and 10 rate it a hold.

TheStreet Ratings rates Equity Residential as a buy. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, impressive record of earnings per share growth, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

On the positive front, Institutional Financial Markets ( IFMI), up 65.7%, Altisource Residential Corporation ( RESI), up 26.9%, China HGS Real Estate ( HGSH), up 25.4%, and China Housing & Land Development ( CHLN), up 17.8%, were all gainers within the real estate industry with Digital Realty ( DLR) being today's featured real estate industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the real estate industry could consider iShares Dow Jones US Real Estate ( IYR) while those bearish on the real estate industry could consider ProShares Short Real Estate Fund ( REK).

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