Could Invitation Homes Inc. Be A Rising Market Star?

Blackstone’s Invitation Homes is a company that specializes in offering rental homes to customers. As such, the company is heavily involved in the real estate market. It offers up single family homes for rent in some of the key residential areas in the United States. Equity group Blackstone mainly backs the company and as such the firm is sometimes referred to as Blackstone’s Invitation Homes.

The company was founded in 2012 when Blackstone had big buyers invest in the real estate sector of the economy. This move followed the effects of the housing crash and as such the buyers were able to obtain properties all over the US at depressed rates. Investors at the time predicted there would be a demand for rental housing since many Americans had had their homes lost due to foreclosure. Further, these families could not acquire mortgages as banks deemed that they were not creditworthy.

Invitation Homes Inc. went public on the 31st of January this year. It offered its shares at a price of $20 per share. This price was in the upper half of its price range, which was $18 – $21 per share. The company sold 77 million shares during its offering, from which it was able to raise $1.54 billion. At the time of its release, Invitation Homes’ offering was the largest since mid-2015. However, other companies have come up with more extensive offerings as the year progresses, such as the unicorn company Snap Inc.

Lead underwriters for the company’s offering were Deutsche Bank Securities and J.P. Morgan. Managers for the release included BofA Merrill Lynch, Goldman, Sachs & Co., Wells Fargo Securities, Credit Suisse, Morgan Stanley and RBC Capital Markets.

On February 1st this year, Invitation Homes Inc. appeared in the stock market. The company’s shares are being traded under the ticker “INVH.” The company opened at a slight change of $20.10, and its price ranged from $19.80 to $20.42 throughout its first trading day. At the end of that trading session, the company remained unchanged from its IPO price of $20. This figure valued the company at $6 billion according to securities fillings.

The firm has been earning steady revenue for some time. At the time of its release, it had made $904.5 million in the past twelve months. Further, the New York-based company only had a loss of $90 million from the twelve months before its release. This debt was likely covered with revenue raised from the offering.

Invitation Homes has close to 50,000 houses under its management. Most of these houses are located in the Western and Southeastern areas of the United States. Almost 15 percent of the homes the company owns are located in South Florida while another 12.4 percent are found in Southern California.

The stock market is a relatively positive environment for Invitation Homes Inc. The company only has two major rivals within the markets, American Homes 4 Rent, and Colony Starwood Homes. Both of these companies have had rising values of their stock, resulting in increases of 0.45 and 1.20 percent for either company. As such, Invitation Homes is expected to also have increased values in its stock over time.