Realty Income Corporation (NYSE: O) and Columbia Property Trust (NYSE:CXP) are both mid-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, risk, valuation, profitability, institutional ownership and dividends.

Volatility and Risk

Realty Income Corporation has a beta of 0.32, meaning that its stock price is 68% less volatile than the S&P 500. Comparatively, Columbia Property Trust has a beta of 1.17, meaning that its stock price is 17% more volatile than the S&P 500.

Dividends

Realty Income Corporation pays an annual dividend of $2.54 per share and has a dividend yield of 4.4%. Columbia Property Trust pays an annual dividend of $0.80 per share and has a dividend yield of 3.7%. Realty Income Corporation pays out 217.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Columbia Property Trust pays out 70.2% of its earnings in the form of a dividend. Columbia Property Trust has raised its dividend for 21 consecutive years.

Earnings and Valuation

This table compares Realty Income Corporation and Columbia Property Trust’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Realty Income Corporation $1.16 billion 13.50 $1.05 billion $1.17 48.85
Columbia Property Trust $376.05 million 6.95 $171.48 million $1.14 18.90

Realty Income Corporation has higher revenue and earnings than Columbia Property Trust. Columbia Property Trust is trading at a lower price-to-earnings ratio than Realty Income Corporation, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

69.0% of Realty Income Corporation shares are held by institutional investors. Comparatively, 64.8% of Columbia Property Trust shares are held by institutional investors. 0.3% of Realty Income Corporation shares are held by company insiders. Comparatively, 0.5% of Columbia Property Trust shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Realty Income Corporation and Columbia Property Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Realty Income Corporation 29.19% 5.14% 2.62%
Columbia Property Trust 37.27% 5.55% 3.30%

Analyst Recommendations

This is a summary of current ratings for Realty Income Corporation and Columbia Property Trust, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Realty Income Corporation 2 4 3 0 2.11
Columbia Property Trust 0 3 4 0 2.57

Realty Income Corporation currently has a consensus target price of $66.00, indicating a potential upside of 15.49%. Columbia Property Trust has a consensus target price of $23.80, indicating a potential upside of 10.44%. Given Realty Income Corporation’s higher possible upside, equities analysts clearly believe Realty Income Corporation is more favorable than Columbia Property Trust.

Summary

Columbia Property Trust beats Realty Income Corporation on 9 of the 17 factors compared between the two stocks.

About Realty Income Corporation

Realty Income Corporation is a real estate investment trust (REIT). The Company is engaged in in-house acquisition, portfolio management, asset management, credit research, real estate research, legal, finance and accounting, information technology and capital markets capabilities. As of December 31, 2016, the Company owned a diversified portfolio of 4,944 properties located in 49 states and Puerto Rico, with over 83.0 million square feet of leasable space leased to 248 different commercial tenants doing business in 47 separate industries. As of December 31, 2016, of the 4,944 properties in the portfolio, 4,920, or 99.5%, were single-tenant properties, and the remaining were multi-tenant properties. As of December 31, 2016, of the 4,920 single-tenant properties, 4,836 were leased with a weighted average remaining lease term (excluding rights to extend a lease at the option of the tenant) of approximately 9.8 years.

About Columbia Property Trust

Columbia Property Trust, Inc. operates as a real estate investment trust (REIT), which owns and operates commercial real estate properties. The Company’s primary objective is to generate long-term shareholder returns from a combination of steadily growing cash flows and appreciation in its net asset values, through the acquisition and ownership of office buildings located principally in high-barrier-to-entry markets. The Company’s segments include New York, San Francisco, Atlanta, Washington, D.C., Boston, Los Angeles and all other office markets. The all other office markets segment consists of properties in similar, low-barrier to entry geographic locations, in which the Company does not plan to make further investments. The Company conducts its business primarily through Columbia Property Trust Operating Partnership, L.P. (Columbia Property Trust OP), which acquires, develops, owns, leases and operates real properties directly through subsidiaries or through joint ventures.

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