Invitation Homes Faces Market Challenges Amid FTC Accusations
Invitation Homes Inc. (INVH), headquartered in Dallas, specializes in leasing and managing single-family homes. The company holds a market cap of $19.5 billion and adapts to shifting lifestyle trends by offering high-quality homes equipped with modern amenities.
Underperformance Compared to Market Peers
Over the past year, INVH has struggled to keep pace with the broader market. While the S&P 500 Index ($SPX) surged by 31.1% in the same period, INVH’s stock has dipped slightly. In 2024, it fell 6.8%, contrasting sharply with the SPX’s strong 19.8% return year-to-date.
Comparative Returns Highlight Challenges
More specifically, INVH also lagged behind the Residential REIT ETF’s (HAUS) returns, which improved by 26.6% over the last year and 13.3% in 2024.
Concerns Arise Following FTC Allegations
On September 24, INVH shares endured a 2.6% drop amid allegations from the U.S. Federal Trade Commission (FTC). The FTC accused the company of misleading customers regarding lease costs, neglecting home inspections, imposing questionable fees, and improperly handling security deposits post-tenancy.
Future Projections and Analyst Ratings
For the fiscal year ending in December, analysts predict that Invitation Homes’ Funds from Operations (FFO) per share will increase by 3.4% to $1.83. Historically, INVH has tended to beat FFO expectations outlined in its quarterly reports.
Among the 22 analysts assessing INVH, the average recommendation is a “Moderate Buy.” This consensus is derived from nine “Strong Buy” ratings, two “Moderate Buy” ratings, and 11 “Holds.”
A Slight Shift in Analyst Sentiment
This outlook is marginally less positive than two months ago, when ten analysts had rated INVH as a “Strong Buy.”
Price Targets Set by Financial Analysts
On October 1, RBC Capital analyst Brad Heffern maintained a “Hold” rating on Invitation Homes, establishing a price target of $36. The average price target for INVH stands at $38.44, suggesting a 20.9% upside from current levels. The highest target from analysts reaches $43, hinting at a potential 35.3% increase from today’s price.
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On the date of publication, Kritika Sarmah did not hold (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data provided in this article are strictly for informational purposes. For more details, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Nasdaq, Inc.
