Paramount Group (NYSE: PGRE) and Corporate Office Properties Trust (NYSE:OFC) are both mid-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, analyst recommendations, risk, earnings, profitabiliy, institutional ownership and valuation.

Earnings and Valuation

This table compares Paramount Group and Corporate Office Properties Trust’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Paramount Group $693.51 million 5.46 $373.80 million ($0.02) -818.50
Corporate Office Properties Trust $578.09 million 5.70 $294.26 million $0.73 45.60

Paramount Group has higher revenue and earnings than Corporate Office Properties Trust. Paramount Group is trading at a lower price-to-earnings ratio than Corporate Office Properties Trust, indicating that it is currently the more affordable of the two stocks.

Dividends

Paramount Group pays an annual dividend of $0.38 per share and has a dividend yield of 2.3%. Corporate Office Properties Trust pays an annual dividend of $1.10 per share and has a dividend yield of 3.3%. Paramount Group pays out -1,900.0% of its earnings in the form of a dividend. Corporate Office Properties Trust pays out 150.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Insider and Institutional Ownership

67.1% of Paramount Group shares are owned by institutional investors. 5.7% of Paramount Group shares are owned by company insiders. Comparatively, 0.6% of Corporate Office Properties Trust shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Volatility and Risk

Paramount Group has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500. Comparatively, Corporate Office Properties Trust has a beta of 0.84, meaning that its stock price is 16% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Paramount Group and Corporate Office Properties Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Paramount Group 2 1 1 0 1.75
Corporate Office Properties Trust 2 7 1 0 1.90

Paramount Group currently has a consensus target price of $15.50, indicating a potential downside of 5.31%. Corporate Office Properties Trust has a consensus target price of $32.75, indicating a potential downside of 1.62%. Given Corporate Office Properties Trust’s stronger consensus rating and higher possible upside, analysts clearly believe Corporate Office Properties Trust is more favorable than Paramount Group.

Profitability

This table compares Paramount Group and Corporate Office Properties Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Paramount Group -0.44% -0.06% -0.04%
Corporate Office Properties Trust 15.86% 6.55% 2.48%

Summary

Corporate Office Properties Trust beats Paramount Group on 9 of the 15 factors compared between the two stocks.

About Paramount Group

Paramount Group, Inc. is a fully-integrated real estate investment trust (REIT) focused on owning, operating, managing, acquiring and redeveloping Class A office properties in select central business district submarkets of New York City, Washington, District of Columbia (D.C.) and San Francisco. The Company conducts its business through, and substantially all its interests in properties and investments are held by, Paramount Group Operating Partnership LP (the Operating Partnership). The Company’s segments include New York, Washington, D.C. and San Francisco. As of December 31, 2016, the Company’s portfolio consisted of 13 Class A office properties aggregating approximately 10.8 million square feet that was 93.3% leased and 90.9% occupied. The Company also has an investment management business, where it serves as the general partner and property manager of certain private equity real estate funds for institutional investors and high-net-worth individuals.

About Corporate Office Properties Trust

Corporate Office Properties Trust is a fully-integrated and self-managed real estate investment trust (REIT). The Company owns, manages, leases, develops and acquires office and data center properties. The Company’s segments are Defense/IT Locations; Regional Office; operating wholesale data center, and other. As of December 31, 2016, the Company’s properties included 164 operating office properties totaling 17.2 million square feet, including 13 triple-net leased, single-tenant data center properties; 11 office properties under construction or redevelopment; 1,028 acres of land controlled for future development, and a wholesale data center with a critical load of 19.25 megawatts. The Company conducts all of its operations through Corporate Office Properties, L.P. (COPLP) and subsidiaries (collectively, the Operating Partnership). COPLP owns real estate both directly and through subsidiary partnerships and limited liability companies (LLCs).

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