Washington Prime Group (WPG) versus DDR Corp. (DDR) Head-To-Head Analysis
DDR Corp. (NYSE: DDR) and Washington Prime Group (NYSE:WPG) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.
Insider and Institutional Ownership
80.0% of DDR Corp. shares are owned by institutional investors. Comparatively, 92.0% of Washington Prime Group shares are owned by institutional investors. 16.1% of DDR Corp. shares are owned by company insiders. Comparatively, 0.3% of Washington Prime Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This table compares DDR Corp. and Washington Prime Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Washington Prime Group||22.65%||17.36%||3.73%|
DDR Corp. pays an annual dividend of $0.76 per share and has a dividend yield of 7.5%. Washington Prime Group pays an annual dividend of $1.00 per share and has a dividend yield of 11.8%. DDR Corp. pays out -380.0% of its earnings in the form of a dividend. Washington Prime Group pays out 108.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Washington Prime Group has raised its dividend for 6 consecutive years. Washington Prime Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Volatility and Risk
DDR Corp. has a beta of 0.8, suggesting that its share price is 20% less volatile than the S&P 500. Comparatively, Washington Prime Group has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500.
This is a summary of current ratings for DDR Corp. and Washington Prime Group, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Washington Prime Group||1||0||0||0||1.00|
DDR Corp. presently has a consensus price target of $13.50, indicating a potential upside of 33.14%. Given DDR Corp.’s stronger consensus rating and higher probable upside, equities analysts plainly believe DDR Corp. is more favorable than Washington Prime Group.
Earnings & Valuation
This table compares DDR Corp. and Washington Prime Group’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|DDR Corp.||$963.85 million||3.86||$622.40 million||($0.20)||-50.70|
|Washington Prime Group||$819.27 million||1.92||$487.39 million||$0.92||9.22|
DDR Corp. has higher revenue and earnings than Washington Prime Group. DDR Corp. is trading at a lower price-to-earnings ratio than Washington Prime Group, indicating that it is currently the more affordable of the two stocks.
About DDR Corp.
DDR Corp. is a self-administered and self-managed real estate investment trust. It operates through two segments: shopping centers and loan investments. It is in the business of acquiring, owning, developing, redeveloping, expanding, leasing and managing shopping centers. As of December 31, 2016, it owned and managed approximately 106 million total square feet of gross leasable area (GLA). As of December 31, 2016, the portfolio properties included 319 shopping centers (including 152 centers owned through joint ventures). As of December 31, 2016, the portfolio properties also included over 650 acres of undeveloped land, including parcels located adjacent to certain of the shopping centers. As of December 31, 2016, the portfolio properties aggregated to 75.8 million square feet of Company-owned GLA located in 35 states, plus Puerto Rico. These centers are in the Southeast and Midwest, with significant concentrations in Florida, Georgia, Ohio and North Carolina, as well as Puerto Rico.
About Washington Prime Group
Washington Prime Group Inc. (WPG Inc.), formerly WP Glimcher Inc., operates as a self-administered and self-managed real estate investment trust (REIT). The Company’s primary business is the ownership, development and management of retail real estate within the United States. The Company owns, develops and manages enclosed retail properties and community centers. As of December 31, 2016, its assets consisted of material interests in 114 shopping centers in the United States, consisting of approximately 63 million square feet of gross leasable area. The Company also owns parcels of land, which can be used for either the development of new shopping centers or the expansion of existing properties. Washington Prime Group, L.P. is the Company’s majority-owned partnership subsidiary that owns, develops and manages, through its affiliates, all of WPG Inc.’s real estate properties and other assets. Its properties include Irving Mall, Lindale Mall, Markland Plaza and Royal Eagle Plaza.
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