Analyzing Retail Opportunity Investments Corp. (ROIC) and Ramco-Gershenson Properties Trust (RPT)
Retail Opportunity Investments Corp. (NASDAQ: ROIC) and Ramco-Gershenson Properties Trust (NYSE:RPT) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, risk, analyst recommendations, profitability, dividends, valuation and earnings.
Valuation and Earnings
This table compares Retail Opportunity Investments Corp. and Ramco-Gershenson Properties Trust’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Retail Opportunity Investments Corp.||N/A||N/A||N/A||$0.33||58.03|
|Ramco-Gershenson Properties Trust||$263.77 million||3.99||$165.05 million||$0.41||32.37|
Ramco-Gershenson Properties Trust has higher revenue and earnings than Retail Opportunity Investments Corp.. Ramco-Gershenson Properties Trust is trading at a lower price-to-earnings ratio than Retail Opportunity Investments Corp., indicating that it is currently the more affordable of the two stocks.
This table compares Retail Opportunity Investments Corp. and Ramco-Gershenson Properties Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Retail Opportunity Investments Corp.||13.92%||2.71%||1.31%|
|Ramco-Gershenson Properties Trust||15.05%||4.99%||1.86%|
Risk and Volatility
Retail Opportunity Investments Corp. has a beta of 0.68, meaning that its share price is 32% less volatile than the S&P 500. Comparatively, Ramco-Gershenson Properties Trust has a beta of 0.74, meaning that its share price is 26% less volatile than the S&P 500.
Insider and Institutional Ownership
94.9% of Retail Opportunity Investments Corp. shares are owned by institutional investors. Comparatively, 98.7% of Ramco-Gershenson Properties Trust shares are owned by institutional investors. 2.2% of Retail Opportunity Investments Corp. shares are owned by company insiders. Comparatively, 1.6% of Ramco-Gershenson Properties Trust shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Retail Opportunity Investments Corp. pays an annual dividend of $0.75 per share and has a dividend yield of 3.9%. Ramco-Gershenson Properties Trust pays an annual dividend of $0.88 per share and has a dividend yield of 6.6%. Retail Opportunity Investments Corp. pays out 227.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ramco-Gershenson Properties Trust pays out 214.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ramco-Gershenson Properties Trust has raised its dividend for 4 consecutive years. Ramco-Gershenson Properties Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a summary of current recommendations for Retail Opportunity Investments Corp. and Ramco-Gershenson Properties Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Retail Opportunity Investments Corp.||0||4||3||0||2.43|
|Ramco-Gershenson Properties Trust||1||4||3||0||2.25|
Retail Opportunity Investments Corp. presently has a consensus price target of $22.33, indicating a potential upside of 16.62%. Ramco-Gershenson Properties Trust has a consensus price target of $15.14, indicating a potential upside of 14.11%. Given Retail Opportunity Investments Corp.’s stronger consensus rating and higher possible upside, analysts clearly believe Retail Opportunity Investments Corp. is more favorable than Ramco-Gershenson Properties Trust.
Ramco-Gershenson Properties Trust beats Retail Opportunity Investments Corp. on 10 of the 14 factors compared between the two stocks.
Retail Opportunity Investments Corp. Company Profile
Retail Opportunity Investments Corp. (ROIC) is a fully integrated, self-managed real estate investment trust (REIT). The Company specializes in the acquisition, ownership and management of necessity-based community and neighborhood shopping centers on the west coast of the United States, anchored by supermarkets and drugstores. Retail Opportunity Investments Partnership, LP is the operating partnership of the Company. The Operating Partnership holds substantially all the assets of the Company and directly or indirectly holds the ownership interests in the Company’s real estate ventures. The Operating Partnership conducts the operations of the Company’s business. As of December 31, 2016, the Company’s portfolio consisted of 82 properties (81 retail and one office) totaling approximately 9.4 million square feet of gross leasable area (GLA). As of December 31, 2016, the Company’s portfolio was approximately 97.6% leased.
Ramco-Gershenson Properties Trust Company Profile
Ramco-Gershenson Properties Trust is an equity real estate investment trust. The Company’s primary business is the ownership, management, redevelopment, development and operation of retail shopping centers. As of December 31, 2016, it owned and managed multi-anchored shopping centers in 12 metropolitan markets in the United States. It conducts its business through its operating partnership, Ramco-Gershenson Properties, L.P. It invests in large, multi-anchored shopping centers that include national chain store tenants and supermarket tenants. National chain anchor tenants in its centers include, among others, Bed Bath and Beyond, Dick’s Sporting Goods, and Home Depot. Supermarket anchor tenants in its centers include, among others, Publix Super Market, Whole Foods, Kroger and Sprouts. Its shopping centers are located in metropolitan markets, such as Metro Detroit, Southeast Florida, Greater Denver, Cincinnati, St. Louis, Jacksonville, Tampa/Lakeland, Milwaukee, Chicago and Atlanta.
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