Financial Analysis: Whitestone REIT (WSR) vs. Federal Realty Investment Trust (FRT)
Whitestone REIT (NYSE: WSR) and Federal Realty Investment Trust (NYSE:FRT) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their profitability, earnings, valuation, institutional ownership, dividends, analyst recommendations and risk.
Insider and Institutional Ownership
43.8% of Whitestone REIT shares are owned by institutional investors. Comparatively, 93.9% of Federal Realty Investment Trust shares are owned by institutional investors. 5.3% of Whitestone REIT shares are owned by company insiders. Comparatively, 1.1% of Federal Realty Investment Trust shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Risk & Volatility
Whitestone REIT has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500. Comparatively, Federal Realty Investment Trust has a beta of 0.3, indicating that its stock price is 70% less volatile than the S&P 500.
Valuation and Earnings
This table compares Whitestone REIT and Federal Realty Investment Trust’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Whitestone REIT||$112.35 million||4.50||$49.43 million||$0.13||101.01|
|Federal Realty Investment Trust||$820.60 million||11.45||$526.36 million||$3.45||37.68|
Federal Realty Investment Trust has higher revenue and earnings than Whitestone REIT. Federal Realty Investment Trust is trading at a lower price-to-earnings ratio than Whitestone REIT, indicating that it is currently the more affordable of the two stocks.
Whitestone REIT pays an annual dividend of $1.14 per share and has a dividend yield of 8.7%. Federal Realty Investment Trust pays an annual dividend of $3.92 per share and has a dividend yield of 3.0%. Whitestone REIT pays out 877.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Federal Realty Investment Trust pays out 113.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Whitestone REIT has increased its dividend for 49 consecutive years. Whitestone REIT is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a breakdown of current ratings and target prices for Whitestone REIT and Federal Realty Investment Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Federal Realty Investment Trust||1||2||7||0||2.60|
Whitestone REIT presently has a consensus target price of $14.67, indicating a potential upside of 11.70%. Federal Realty Investment Trust has a consensus target price of $140.25, indicating a potential upside of 7.88%. Given Whitestone REIT’s higher possible upside, equities research analysts plainly believe Whitestone REIT is more favorable than Federal Realty Investment Trust.
This table compares Whitestone REIT and Federal Realty Investment Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Federal Realty Investment Trust||30.40%||10.91%||4.05%|
Federal Realty Investment Trust beats Whitestone REIT on 11 of the 17 factors compared between the two stocks.
Whitestone REIT Company Profile
Whitestone REIT is a real estate investment trust. The Company is engaged in owning and operating commercial properties in culturally diverse markets in various metropolitan areas. The Company’s acquisition targets are located in densely populated, culturally diverse neighborhoods, primarily in and around Austin, Chicago, Dallas-Fort Worth, Houston, Phoenix and San Antonio. As of December 31, 2016, the Company owned or held interests in 69 commercial properties, including 15 properties in Houston, five properties in Dallas-Fort Worth, three properties in San Antonio, four properties in Austin, 27 properties in the Scottsdale and Phoenix, Arizona metropolitan areas, and one property in Buffalo Grove, Illinois, a suburb of Chicago. As of December 31, 2016, the Company’s properties included Heritage Trace Plaza, Headquarters Village, La Mirada, The Marketplace at Central, Mercado at Scottsdale Ranch, Paradise Plaza, Parkside Village North, Pima Norte and Quinlan Crossing.
Federal Realty Investment Trust Company Profile
Federal Realty Investment Trust is an equity real estate investment trust (REIT). The Company specializes in the ownership, management and redevelopment of retail and mixed-use properties located primarily in affluent communities in selected metropolitan markets in the Northeast and Mid-Atlantic regions of the United States, as well as in California and South Florida. As of December 31, 2016, the Company owned or had an interest in community and neighborhood shopping centers and mixed-use properties, which operated as 96 retail real estate projects and included approximately 22.6 million square feet. As of December 31, 2016, its 96 retail shopping center and mixed-use properties were located in 12 states and the District of Columbia. As of December 31, 2016, there were approximately 2,900 leases with tenants providing a range of retail products and services. These tenants range from sole proprietorships to national retailers, or corporate group of tenants.
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