AVALONBAY COMMUNITIES INC (AVB) Stock Fundamental Analysis
USA • New York Stock Exchange • NYSE:AVB • US0534841012
177.67 USD
+2.87 (+1.64%)
At close: Jan 30, 2026
177.67 USD
0 (0%)
After Hours: 1/30/2026, 5:05:00 PM
We assign a fundamental rating of 4 out of 10 to AVB. AVB was compared to 20 industry peers in the Residential REITs industry. While AVB belongs to the best of the industry regarding profitability, there are concerns on its financial health. AVB is valued expensive and it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- In the past year AVB was profitable.
- AVB had a positive operating cash flow in the past year.
- AVB had positive earnings in each of the past 5 years.
- Each year in the past 5 years AVB had a positive operating cash flow.
1.2 Ratios
- With a decent Return On Assets value of 5.31%, AVB is doing good in the industry, outperforming 75.00% of the companies in the same industry.
- AVB has a Return On Equity of 9.77%. This is in the better half of the industry: AVB outperforms 75.00% of its industry peers.
- AVB has a Return On Invested Capital of 3.46%. This is amongst the best in the industry. AVB outperforms 85.00% of its industry peers.
- AVB had an Average Return On Invested Capital over the past 3 years of 3.44%. This is in line with the industry average of 2.59%.
- The last Return On Invested Capital (3.46%) for AVB is above the 3 year average (3.44%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.31% | ||
| ROE | 9.77% | ||
| ROIC | 3.46% |
ROA(3y)5.06%
ROA(5y)4.9%
ROE(3y)9%
ROE(5y)8.77%
ROIC(3y)3.44%
ROIC(5y)3.18%
1.3 Margins
- AVB has a better Profit Margin (38.71%) than 85.00% of its industry peers.
- AVB's Profit Margin has improved in the last couple of years.
- Looking at the Operating Margin, with a value of 30.35%, AVB belongs to the top of the industry, outperforming 90.00% of the companies in the same industry.
- In the last couple of years the Operating Margin of AVB has declined.
- AVB has a Gross Margin of 62.81%. This is in the better half of the industry: AVB outperforms 80.00% of its industry peers.
- In the last couple of years the Gross Margin of AVB has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.35% | ||
| PM (TTM) | 38.71% | ||
| GM | 62.81% |
OM growth 3Y5.59%
OM growth 5Y-2.68%
PM growth 3Y-5.32%
PM growth 5Y1.91%
GM growth 3Y0.2%
GM growth 5Y-1.16%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so AVB is destroying value.
- AVB has about the same amout of shares outstanding than it did 1 year ago.
- The number of shares outstanding for AVB has been increased compared to 5 years ago.
- The debt/assets ratio for AVB has been reduced compared to a year ago.
2.2 Solvency
- AVB has an Altman-Z score of 1.75. This is a bad value and indicates that AVB is not financially healthy and even has some risk of bankruptcy.
- Looking at the Altman-Z score, with a value of 1.75, AVB belongs to the top of the industry, outperforming 90.00% of the companies in the same industry.
- AVB has a Debt/Equity ratio of 0.73. This is a neutral value indicating AVB is somewhat dependend on debt financing.
- With a decent Debt to Equity ratio value of 0.73, AVB is doing good in the industry, outperforming 80.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.73 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.75 |
ROIC/WACC0.48
WACC7.23%
2.3 Liquidity
- A Current Ratio of 0.12 indicates that AVB may have some problems paying its short term obligations.
- The Current ratio of AVB (0.12) is worse than 70.00% of its industry peers.
- AVB has a Quick Ratio of 0.12. This is a bad value and indicates that AVB is not financially healthy enough and could expect problems in meeting its short term obligations.
- With a Quick ratio value of 0.12, AVB is not doing good in the industry: 70.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.12 | ||
| Quick Ratio | 0.12 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 12.18% over the past year.
- AVB shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.12% yearly.
- AVB shows a small growth in Revenue. In the last year, the Revenue has grown by 4.71%.
- The Revenue has been growing slightly by 4.62% on average over the past years.
EPS 1Y (TTM)12.18%
EPS 3Y17.41%
EPS 5Y6.12%
EPS Q2Q%2.68%
Revenue 1Y (TTM)4.71%
Revenue growth 3Y8.28%
Revenue growth 5Y4.62%
Sales Q2Q%4.67%
3.2 Future
- AVB is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -4.50% yearly.
- Based on estimates for the next years, AVB will show a small growth in Revenue. The Revenue will grow by 5.45% on average per year.
EPS Next Y-5.76%
EPS Next 2Y-16.07%
EPS Next 3Y-9.38%
EPS Next 5Y-4.5%
Revenue Next Year4.4%
Revenue Next 2Y4.13%
Revenue Next 3Y4.57%
Revenue Next 5Y5.45%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 21.67, AVB is valued on the expensive side.
- Based on the Price/Earnings ratio, AVB is valued cheaper than 85.00% of the companies in the same industry.
- When comparing the Price/Earnings ratio of AVB to the average of the S&P500 Index (28.30), we can say AVB is valued slightly cheaper.
- Based on the Price/Forward Earnings ratio of 33.23, the valuation of AVB can be described as expensive.
- Based on the Price/Forward Earnings ratio, AVB is valued cheaper than 95.00% of the companies in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.57. AVB is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.67 | ||
| Fwd PE | 33.23 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, AVB is valued a bit more expensive than the industry average as 65.00% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 18.44 |
4.3 Compensation for Growth
- The excellent profitability rating of AVB may justify a higher PE ratio.
- AVB's earnings are expected to decrease with -9.38% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)3.54
EPS Next 2Y-16.07%
EPS Next 3Y-9.38%
5. Dividend
5.1 Amount
- AVB has a Yearly Dividend Yield of 3.98%.
- Compared to an average industry Dividend Yield of 32.02, AVB is paying slightly less dividend.
- AVB's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.98% |
5.2 History
- The dividend of AVB has a limited annual growth rate of 2.45%.
- AVB has paid a dividend for at least 10 years, which is a reliable track record.
- AVB has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)2.45%
Div Incr Years2
Div Non Decr Years26
5.3 Sustainability
- AVB pays out 84.41% of its income as dividend. This is not a sustainable payout ratio.
- AVB's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP84.41%
EPS Next 2Y-16.07%
EPS Next 3Y-9.38%
AVALONBAY COMMUNITIES INC / AVB FAQ
Can you provide the ChartMill fundamental rating for AVALONBAY COMMUNITIES INC?
ChartMill assigns a fundamental rating of 4 / 10 to AVB.
What is the valuation status of AVALONBAY COMMUNITIES INC (AVB) stock?
ChartMill assigns a valuation rating of 3 / 10 to AVALONBAY COMMUNITIES INC (AVB). This can be considered as Overvalued.
Can you provide the profitability details for AVALONBAY COMMUNITIES INC?
AVALONBAY COMMUNITIES INC (AVB) has a profitability rating of 8 / 10.
What is the valuation of AVALONBAY COMMUNITIES INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for AVALONBAY COMMUNITIES INC (AVB) is 21.67 and the Price/Book (PB) ratio is 2.11.
Can you provide the expected EPS growth for AVB stock?
The Earnings per Share (EPS) of AVALONBAY COMMUNITIES INC (AVB) is expected to decline by -5.76% in the next year.