National Retail Properties (NYSE: NNN) and Macerich Company (The) (NYSE:MAC) are both mid-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, profitability, valuation, earnings and analyst recommendations.

Dividends

National Retail Properties pays an annual dividend of $1.90 per share and has a dividend yield of 4.6%. Macerich Company (The) pays an annual dividend of $2.84 per share and has a dividend yield of 5.0%. National Retail Properties pays out 142.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Macerich Company (The) pays out 278.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. National Retail Properties has increased its dividend for 7 consecutive years and Macerich Company (The) has increased its dividend for 6 consecutive years.

Profitability

This table compares National Retail Properties and Macerich Company (The)’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
National Retail Properties 44.17% 8.22% 4.03%
Macerich Company (The) 14.39% 3.38% 1.49%

Earnings & Valuation

This table compares National Retail Properties and Macerich Company (The)’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
National Retail Properties $562.72 million 11.06 $500.46 million $1.33 31.37
Macerich Company (The) $1.07 billion 7.50 $635.66 million $1.02 55.65

Macerich Company (The) has higher revenue and earnings than National Retail Properties. National Retail Properties is trading at a lower price-to-earnings ratio than Macerich Company (The), indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings for National Retail Properties and Macerich Company (The), as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
National Retail Properties 0 2 4 0 2.67
Macerich Company (The) 1 8 5 0 2.29

National Retail Properties currently has a consensus target price of $47.40, indicating a potential upside of 13.61%. Macerich Company (The) has a consensus target price of $66.85, indicating a potential upside of 17.77%. Given Macerich Company (The)’s higher possible upside, analysts plainly believe Macerich Company (The) is more favorable than National Retail Properties.

Insider and Institutional Ownership

89.2% of National Retail Properties shares are owned by institutional investors. Comparatively, 94.5% of Macerich Company (The) shares are owned by institutional investors. 1.0% of National Retail Properties shares are owned by insiders. Comparatively, 3.8% of Macerich Company (The) shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility & Risk

National Retail Properties has a beta of 0.37, indicating that its share price is 63% less volatile than the S&P 500. Comparatively, Macerich Company (The) has a beta of 0.8, indicating that its share price is 20% less volatile than the S&P 500.

Summary

Macerich Company (The) beats National Retail Properties on 9 of the 17 factors compared between the two stocks.

About National Retail Properties

National Retail Properties, Inc. is a real estate investment trust (REIT). The Company acquires, owns, invests in and develops properties that are leased primarily to retail tenants under long-term net leases and are primarily held for investment. As of December 31, 2016, it owned 2,535 properties with an aggregate gross leasable area of approximately 27,204,000 square feet, located in 48 states. The Company focuses on investing in a range of property and tenant types; leases, mortgages and other types of real estate interests; loans secured by personal property; loans secured by partnership or membership interests in partnerships or limited liability companies, and securities of other REITs, or other issuers, including for the purpose of exercising control over such entities. The Company owns a portfolio of freestanding retail stores across the United States. It owns approximately 2,290 stores, which are leased to over 400 tenants in approximately 40 different retail categories.

About Macerich Company (The)

The Macerich Company is a self-administered and self-managed real estate investment trust (REIT). The Company is involved in the acquisition, ownership, development, redevelopment, management and leasing of regional and community/power shopping centers located throughout the United States. The Company owns ownership interests in, The Macerich Partnership, L.P. (the Operating Partnership). As of December 31, 2016, the Company, through its operating partnership, had ownership interests in 50 regional shopping centers and seven community/power shopping centers. These 57 regional and community/power shopping centers consisted of approximately 56 million square feet of gross leasable area (GLA), as of December 31, 2016. The Company’s properties include Danbury Fair Mall, Desert Sky Mall, Fresno Fashion Fair, NorthPark Mall, Oaks, The, Towne Mall, Valley Mall, Arrowhead Towne Center, Deptford Mall and South Plains Mall.

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