Critical Analysis: Equity Commonwealth (EQC) vs. Its Peers
Equity Commonwealth (NYSE: EQC) is one of 20 public companies in the “Office REITs” industry, but how does it weigh in compared to its competitors? We will compare Equity Commonwealth to similar companies based on the strength of its analyst recommendations, risk, profitability, institutional ownership, dividends, valuation and earnings.
Risk & Volatility
Equity Commonwealth has a beta of 0.14, indicating that its share price is 86% less volatile than the S&P 500. Comparatively, Equity Commonwealth’s competitors have a beta of 0.90, indicating that their average share price is 10% less volatile than the S&P 500.
Valuation & Earnings
This table compares Equity Commonwealth and its competitors revenue, earnings per share (EPS) and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|Equity Commonwealth||$409.33 million||$194.30 million||35.81|
|Equity Commonwealth Competitors||$672.08 million||$356.91 million||60.40|
Equity Commonwealth’s competitors have higher revenue and earnings than Equity Commonwealth. Equity Commonwealth is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.
Insider and Institutional Ownership
94.1% of Equity Commonwealth shares are held by institutional investors. Comparatively, 85.4% of shares of all “Office REITs” companies are held by institutional investors. 1.0% of Equity Commonwealth shares are held by company insiders. Comparatively, 3.2% of shares of all “Office REITs” companies are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
This table compares Equity Commonwealth and its competitors’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Equity Commonwealth Competitors||4.67%||0.59%||0.44%|
This is a summary of recent ratings and recommmendations for Equity Commonwealth and its competitors, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Equity Commonwealth Competitors||114||514||551||3||2.37|
Equity Commonwealth currently has a consensus target price of $33.00, indicating a potential upside of 7.14%. As a group, “Office REITs” companies have a potential upside of 7.07%. Given Equity Commonwealth’s higher probable upside, analysts plainly believe Equity Commonwealth is more favorable than its competitors.
Equity Commonwealth competitors beat Equity Commonwealth on 8 of the 13 factors compared.
About Equity Commonwealth
Equity Commonwealth is an internally managed and self-advised real estate investment trust. The Company is engaged in the ownership and operation primarily of office buildings across the United States. The Company conducts its activities primarily through EQC Operating Trust (the Operating Trust). As of August 14, 2017, the Company’s portfolio included 20 properties and 11 million square feet. As of December 31, 2016, its properties included Parkshore Plaza; 1225 Seventeenth Street; 1601 Dry Creek Drive; 97 Newberry Road; 33 Stiles Lane; 802 Delaware Avenue; 6600 North Military Trail; East Eisenhower Parkway; 2250 Pilot Knob Road; 411 Farwell Avenue; Cherrington Corporate Center; 1500 Market Street; Foster Plaza; 4515 Seton Center Parkway; Bridgepoint Square, and Research Park. As of December 31, 2016, the Company’s land parcels included 625 Crane Street and Cabot Business Park Land.
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