American Homes 4 Rent (AMH): what the price requires
The current priced-in claim for American Homes 4 Rent (AMH) is temporarily suppressed because the live engine record is unavailable. The dated report remains a snapshot, not a current market read.
Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/AMH
Headline
| Field | Value |
|---|---|
| Ticker | AMH |
| Company | American Homes 4 Rent |
| Current price | $33.70/sh |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | reit |
| Price-to-FFO | 13.0x |
| FFO yield | 7.7% |
The price sits below what even a 5%/yr funds-from-operations decline would warrant; the inversion reports a bound, not a solved growth path.
Solve inputs: computed at a 9.1% cost of equity with 4% terminal growth over a 5-year stage.
How unusual the bet is: within-range
| Reference | Value |
|---|---|
| vs own history | -1.59σ |
| cohort percentile (of 88 peers) | 30 |
| implied end-window share | 0% |
Valuation X-Ray
The price is justified by relative-multiple and growth-DCF; asset-based/earnings-power land below the price.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 2.24x | 4 | expensive |
| Earnings | 2.11x | 4 | expensive |
| Relative | 1.00x | 6 | justifies |
| Growth | 0.87x | 5 | justifies |
Families that justify the price: Relative, Growth Families that call it expensive: Asset, Earnings
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 6.7%); the inversion above states its own rate.
Per-Model Detail (n=19)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $76.09 | 0.44x | yes | FCF base $0.9B, growth 6% (input: historical growth), terminal g 4.0%, WACC 6.7%, 5yr projection |
| DCF Exit Multiple | Growth | $38.86 | 0.87x | yes | Exit EV/EBITDA: 32.2x / 34.2x / 36.2x (bear / base = today's held flat / bull), 5yr |
| Relative Valuation | Relative | $47.39 | 0.71x | yes | P/E 26.2x (blended: static sector reference 35x + trailing (TTM) 13x), scenarios: 22.0x / 26.2x / 30.4x (bear / base = reference held flat / bull), EV/EBITDA 24.27x |
| Simple DDM | Growth | $92.68 | 0.36x | yes | DPS $1.33, g=7.7% (sustainable: ROE (TTM) × retention; not the terminal-growth assumption), ke=9.3% |
| Two-Stage DDM | Growth | $32.28 | 1.04x | yes | Stage 1: 10% for 5yr, Stage 2: 3.5% perpetual |
| Simple Excess Return | Asset | $15.82 | 2.13x | yes | BV/sh $19.01, ROE (TTM) 7.7%, ke 9.3% |
| Two-Stage Excess Return | Asset | $14.40 | 2.34x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $26.22 | 1.29x | yes | Rev $1.9B, growth 6% (input: historical growth; tapered), Terminal P/S: 5.5x / 6.6x / 7.6x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $31.08 | 1.08x | yes | FFO/share $2.59, growth 10% (input: historical FFO/share growth, 9y median), PEG=2.19 (Overvalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | — | — | no | — |
| Residual Income | Asset | $14.18 | 2.38x | yes | BV $19.01 + 5yr PV of (ROE (TTM) 7.7% − Kₑ 9.3%) × BV; BV grows 5.0%/yr |
| Graham Number | Asset | $33.28 | 1.01x | yes | √(22.5 × FFO/share $2.59 × BVPS $19.01) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $13.91 | 2.42x | yes | EBITDA $0.51B × sector EV/EBITDA 20.0x |
| FCF Yield | Earnings | $11.14 | 3.03x | yes | FCF $844.0M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $10.40 | 3.24x | yes | SBC-adj FCF $0.82B (FCF $0.84B − SBC $0.02B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $64.01 | 0.53x | yes | FFO/share $2.59 × (8.5 + 2×10.5%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | — | — | no | — |
| P/Sales Sector | Relative | $30.67 | 1.10x | yes | Revenue $1.86B × sector P/S 6.0x |
| PEG Fair Value | Relative | $40.77 | 0.83x | yes | FFO/share $2.59 × (PEG 1.5 × growth 10.5% (input: historical FFO/share growth, 9y median)) → PE 15.7x |
| Earnings Yield | Earnings | $28.00 | 1.20x | yes | FFO/share $2.59 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | $36.70 | 0.92x | yes | FFO/share $2.59 × 14.2x P/FFO (route cohort median, n=85); FFO $0.94B (FFO incl. D&A + impairments, FY2025, companyfacts), shares 364M |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Funds from operations (trailing) | $943.4m |
| Share count CAGR (dilution) | 1.3% |
| Burning cash | no |
REIT basis: leverage is read against funds from operations (FFO), not depreciation-gutted operating income. The header's implied growth runs on ADJUSTED FFO — FFO minus recurring maintenance capex — so the header's multiple and this leverage ratio use bases that differ by that capex; neither substitutes for the other. Net debt could not be resolved from the corporate debt tags in the filings (REIT notes and mortgage debt are often tagged outside the corporate ladder), so the leverage ratio is withheld rather than rendered from incomplete tags. Interest expense is not separately reported in the cached statements, so fixed-charge coverage cannot be computed.
Bullet Takeaways
- American Homes 4 Rent owns and operates roughly 60,200 single-family rental homes, a scale and operating system that is hard to assemble house by house and is the structural advantage behind its steady occupancy and rent collection.
- The clearest risk is rate and cost driven: as a real-estate trust carrying about $5 billion of net debt and funding new homes through a development program with substantial up-front costs, higher financing costs squeeze both refinancing and the economics of building.
- What to watch is the rent-growth cadence: management guides new leases turning from modestly negative early in the year to positive, renewals settling in the mid-3% range, and full-year core funds-from-operations of $1.89 to $1.95 per share.
Bull Case
The moat here is operational scale in a business most landlords run one house at a time. American Homes 4 Rent owns roughly 60,200 single-family homes and runs them as a single portfolio, with a turnover process the company describes as taking "approximately 20 to 60 days to complete" on leases that "typically have a term of one year." Assembling and maintaining tens of thousands of scattered houses, each with its own roof, plumbing, and tenant, is exactly the kind of fragmented, low-margin chore that rewards a company with national purchasing, standardized maintenance, and a leasing machine. That is where the return advantage comes from: not a premium rent, but a lower cost of running each home and a higher share of rent that survives to funds from operations.
The demand backdrop is structural and, unusually, partly created by the housing market's dysfunction. The filing names the tailwind directly: the company has "benefited from increases in long-term demand due to population growth in households desiring detached single-family homes, the surge in demand for larger living spaces, and increases in mortgage rates which have made home ownership more expensive." When a 7% mortgage prices a family out of buying, renting a house rather than an apartment becomes the substitute, and AMH sits directly in that channel. Higher rates hurt the company's own financing, but they also lock in the renter who would otherwise have bought, which is a hedge most landlords do not have.
Growth is built, not just bought. AMH adds homes through its own construction pipeline, with properties "developed through our internal AMH Development Program and newly constructed properties acquired from third-party developers through our National Builder Program," delivering 457 newly built homes to the operating portfolio in the most recent quarter alone. Building to rent lets the company add modern, low-maintenance houses at a development yield rather than competing for existing homes at retail prices, which is the difference between growing funds from operations and merely growing the asset base. The recent prints show the model working: core funds from operations rose 4.6% to $0.48 per share and adjusted funds from operations rose 8.0% to $0.45, on revenue up 2.8% to $472 million.
Bear Case
The structural fragility sits in the capital structure, because a single-family REIT is a leveraged bet on financing costs as much as on rents. AMH carries about $5 billion of net debt against a portfolio of houses whose value and rent both move with the same interest-rate variable. The filing flags the exposure on the tenant side as well, citing conditions including "economic recession, increased unemployment or underemployment, slowing wage growth, decreasing purchasing power due to inflation, and increased financing costs," which is the bear scenario stated plainly: the same rate environment that prices families out of buying can also weaken their ability to pay rent. Under stress, the debt does not flex but the rent roll does, and that asymmetry is where the downside lives.
The development program, the bull's growth engine, is also a cost-of-capital trap when rates stay high. The company is explicit that build-to-rent homes "involve substantial up-front costs, time to acquire and de"velop, before a dollar of rent arrives. That works when the development yield comfortably clears the cost of financing it. When borrowing costs rise, the spread between what a new home yields and what it costs to fund narrows, and the program that compounds funds from operations in a low-rate world can dilute returns in a high-rate one. A REIT that must keep building to grow is most exposed precisely when capital is most expensive.
The growth the price actually needs is modest, and that cuts against the obvious bear angle. Full-year core funds-from-operations guidance is $1.89 to $1.95 per share, a growth range of roughly 1% to 4%, and same-home core revenue growth is guided at 1.25% to 3.25%. The price does not demand acceleration. So the bear is not that AMH is overvalued on its cash earnings, where the earnings-power lens actually reads the price as full. It is that the steady mid-single-digit world the guidance assumes depends on rents staying firm and rates not forcing a refinancing at a worse spread, and a REIT this rate-sensitive has limited room if either assumption slips.
Valuation
A single-family REIT is valued on its funds from operations, the cash earnings plus property depreciation minus the recurring capital it takes to keep houses leasable, not on an operating multiple. At about 13 times adjusted funds from operations, AMH trades low enough that the price sits below what even a 5% annual decline in funds from operations would warrant. That is the unusual feature: the market is not asking this REIT to grow so much as pricing in a mild deterioration that the guidance does not support. Against its own record the assumed pace is within what AMH has delivered, and against its REIT peers the multiple lands in the lower half of the group.
The methods we use to triangulate split, and the split tells you what kind of bet this is. The asset-value and earnings-power lenses read the price as full, which is what you expect for a REIT whose homes carry real depreciation and whose current cash earnings are capitalized at a demanding yield. When the value-oriented methods say cheap and only the static asset and earnings lenses say full, the read is a value or steady-compounder situation rather than a stretched-growth one. The price is being supported by where peers trade and by the modest forward growth the business is delivering, not by an aggressive durability assumption.
Solvency frames the downside and is the right place to close, because for a leveraged REIT the balance sheet is the whole risk. AMH carries about $5 billion of net debt, and the share count has crept up around 1.3% a year, the normal signature of an externally growing REIT funding new homes partly with equity rather than a dilution problem. The decisive question is not whether the cash earnings justify the price, where the methods already say they roughly do, but whether the financing cost stays manageable as debt is refinanced. The steady rent roll across 60,200 homes is the floor under the downside; the rate environment is the variable that decides how much of the funds-from-operations stream survives to shareholders.
Catalysts
The first-quarter 2026 print, reported in April, beat and showed the rent engine running steadily. Core funds from operations rose 4.6% year over year to $0.48 per share, adjusted funds from operations rose 8.0% to $0.45, and rents and other single-family property revenues increased 2.8% to $472.0 million. The company delivered 457 newly constructed homes to the operating portfolio through its development program during the quarter, bringing the total to roughly 60,200 homes. Management held full-year core funds-from-operations guidance at $1.89 to $1.95 per share, with same-home core revenue growth guided to 1.25% to 3.25%.
The leasing cadence is the catalyst worth tracking through the year. Occupancy rose 60 basis points from April to May, new-lease growth ticked up from 1.2% to 1.5%, and renewals held around 3%, with management framing new leases moving from modestly negative in the first quarter to positive in the second and renewals settling in the mid-3% range by the third. That sequencing, occupancy gains first and rate growth following, is the path the full-year guidance rests on, so each monthly leasing update is a read on whether the steady-compounding thesis is on track.
Peer Cohorts (Per Segment, With Filing Citations)
Single-Family Rental Homes (reported)
- INVH (Invitation Homes Inc.)
- (no filing in the citation store)
- MAA (MID-AMERICA APARTMENT COMMUNITIES, INC.)
- (no filing in the citation store)
- EQR (EQUITY RESIDENTIAL)
- (no filing in the citation store)
- AVB (AVALONBAY COMMUNITIES, INC.)
- (no filing in the citation store)
- ESS (ESSEX PROPERTY TRUST, INC.)
- (no filing in the citation store)
- UDR (UDR, Inc.)
- (no filing in the citation store)
- CPT (CAMDEN PROPERTY TRUST)
- (no filing in the citation store)
- IRT (INDEPENDENCE REALTY TRUST, INC.)
- (no filing in the citation store)
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
AMH Q1 2026 results, 8-K April 2026 · AMH Q1 2026 earnings call, April 2026