Critical Review: La Rosa (NASDAQ:LRHC) & AMREP (NYSE:AXR)

AMREP (NYSE:AXR) and La Rosa (NASDAQ:LRHC) are both small-cap real estate companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, institutional ownership and profitability.

Insider and Institutional Ownership

59.9% of AMREP shares are held by institutional investors. Comparatively, 7.6% of La Rosa shares are held by institutional investors. 37.4% of AMREP shares are held by company insiders. Comparatively, 23.8% of La Rosa shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Volatility and Risk

AMREP has a beta of 1.15, indicating that its stock price is 15% more volatile than the S&P 500. Comparatively, La Rosa has a beta of 1.24, indicating that its stock price is 24% more volatile than the S&P 500.

Profitability

This table compares AMREP and La Rosa’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
AMREP	14.31%	4.21%	4.09%
La Rosa	-46.38%	-3,087.05%	-149.58%

Analyst Ratings

This is a summary of current ratings and recommmendations for AMREP and La Rosa, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AMREP	0	3	0	0	2.00
La Rosa	1	0	0	0	1.00

AMREP currently has a consensus price target of $22.00, suggesting a potential upside of 11.42%. Given AMREP’s stronger consensus rating and higher probable upside, equities research analysts plainly believe AMREP is more favorable than La Rosa.

Earnings & Valuation

This table compares AMREP and La Rosa”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AMREP	$52.85 million	1.99	$10.29 million	$1.08	18.28
La Rosa	$62.27 million	0.01	-$30.55 million	($3,705.40)	-0.00

AMREP has higher earnings, but lower revenue than La Rosa. La Rosa is trading at a lower price-to-earnings ratio than AMREP, indicating that it is currently the more affordable of the two stocks.

Summary

AMREP beats La Rosa on 11 of the 13 factors compared between the two stocks.

About AMREP

AMREP Corporation, through its subsidiaries, primarily engages in the real estate business. The company operates through two segments, Land Development and Homebuilding. It sells developed and undeveloped lots to homebuilders, commercial and industrial property developers, and others. In addition, the company owns mineral interests covering an area of approximately 55,000 surface acres of land in Sandoval County, New Mexico; and owns oil, gas, and minerals and mineral interests covering an area of approximately 147 surface acres of land in Brighton, Colorado. Further, the company focuses on selling single-family detached homes and attached homes. As of April 30, 2023, it owned approximately 17,000 acres in Sandoval County, New Mexico. The company owns an approximately 160-acre property in Brighton, Colorado. AMREP Corporation was founded in 1961 and is headquartered in Havertown, Pennsylvania.

About La Rosa

La Rosa Holdings Corp., through its subsidiaries, operates primarily in the residential real estate market in the United States. The company operates through five segments: Real Estate Brokerage Services (Residential), Franchising Services, Coaching Services, Property Management, and Real Estate Brokerage Services (Commercial). It delivers coaching services to its brokers and franchisee's brokers; and franchises real estate brokerage agencies. The company also engages in the residential and commercial real estate brokerage business; and property management services to owners of single-family residential properties. La Rosa Holdings Corp. was founded in 2004 and is based in Celebration, Florida.