STORE Capital Corporation (NYSE: STOR) and Inland Real Estate (NYSE:IRC) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, dividends, valuation, institutional ownership, profitabiliy, risk and analyst recommendations.

Insider and Institutional Ownership

95.0% of STORE Capital Corporation shares are owned by institutional investors. 0.9% of STORE Capital Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations and price targets for STORE Capital Corporation and Inland Real Estate, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
STORE Capital Corporation 1 3 7 0 2.55
Inland Real Estate 0 0 0 0 N/A

STORE Capital Corporation presently has a consensus target price of $28.15, suggesting a potential upside of 22.02%. Given STORE Capital Corporation’s higher probable upside, research analysts plainly believe STORE Capital Corporation is more favorable than Inland Real Estate.

Profitability

This table compares STORE Capital Corporation and Inland Real Estate’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
STORE Capital Corporation 33.06% 5.22% 2.66%
Inland Real Estate -0.49% -2.46% -0.06%

Valuation & Earnings

This table compares STORE Capital Corporation and Inland Real Estate’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
STORE Capital Corporation $399.08 million 9.89 $360.27 million $0.84 27.46
Inland Real Estate N/A N/A N/A N/A N/A

STORE Capital Corporation has higher revenue and earnings than Inland Real Estate.

Dividends

STORE Capital Corporation pays an annual dividend of $1.16 per share and has a dividend yield of 5.0%. Inland Real Estate does not pay a dividend. STORE Capital Corporation pays out 138.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

STORE Capital Corporation beats Inland Real Estate on 9 of the 10 factors compared between the two stocks.

STORE Capital Corporation Company Profile

STORE Capital Corporation is an internally managed net-lease real estate investment trust. The Company is engaged in the acquisition, investment and management of single tenant operational real estate (STORE) properties. As of December 31, 2016, the Company owned a portfolio that consisted of investments in 1,660 property locations operated by 360 customers across 48 states. Its customers operate across a range of industries within the service, retail and manufacturing sectors of the United States economy, with restaurants, early childhood education centers, movie theaters, health clubs and furniture stores. The Company’s portfolio includes investments in approximately 1,330 property locations operated by over 300 customers across approximately 50 states. The Company provides real estate financing solutions principally to businesses that own STORE properties and operate within the broad-based service, retail and industrial sectors of the United States economy.

Inland Real Estate Company Profile

IRC Retail Centers, Inc., formerly Inland Real Estate Corporation, is a real estate investment trust (REIT). The Company owns, operates and develops open-air neighborhood, community and power shopping centers and single tenant retail properties located throughout the Central and Southeastern United States. Through its subsidiaries, Inland Commercial Property Management, Inc. (ICPM) and Inland TRS Property Management, Inc., the Company manages all properties it owns interests in and properties for certain third parties and related parties. The Company owns investment properties located in the States of Alabama, Arkansas, Florida, Georgia, Illinois, Indiana, Kentucky, Louisiana, Minnesota, Missouri, Nebraska, New York, North Carolina, Ohio, Oklahoma, South Carolina, Texas, Virginia and Wisconsin. The Company owns interests in approximately 130 investment properties, including those owned through its unconsolidated joint ventures.

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