New Lifetime High Reached: Associated Estates Realty (AEC)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified Associated Estates Realty ( AEC) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Associated Estates Realty as such a stock due to the following factors:

  • AEC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $12.7 million.
  • AEC has traded 25,551 shares today.
  • AEC is trading at a new lifetime high.

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More details on AEC:

Associated Estates Realty Corporation is an independent real estate investment trust. The firm invests in the real estate markets of the United States. It specializes in owning and managing apartment communities in the Midwest, Mid-Atlantic and Southeast regions of the United States. The stock currently has a dividend yield of 2.9%. AEC has a PE ratio of 16. Currently there is 1 analyst that rates Associated Estates Realty a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for Associated Estates Realty has been 980,600 shares per day over the past 30 days. Associated Estates has a market cap of $1.7 billion and is part of the financial sector and real estate industry. The stock has a beta of 0.33 and a short float of 3.1% with 2.99 days to cover. Shares are up 23.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Associated Estates Realty as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, notable return on equity and good cash flow from operations. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Compared to its closing price of one year ago, AEC's share price has jumped by 61.05%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, AEC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, ASSOCIATED ESTATES RLTY CORP's return on equity exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has increased to $14.31 million or 13.89% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 0.81%.
  • AEC, with its decline in revenue, underperformed when compared the industry average of 8.5%. Since the same quarter one year prior, revenues slightly dropped by 3.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • ASSOCIATED ESTATES RLTY CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, ASSOCIATED ESTATES RLTY CORP increased its bottom line by earning $2.49 versus $0.09 in the prior year. For the next year, the market is expecting a contraction of 92.4% in earnings ($0.19 versus $2.49).

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