Critical Review: Physicians Realty Trust (DOC) versus CareTrust REIT (CTRE)
Physicians Realty Trust (NYSE: DOC) and CareTrust REIT (NASDAQ:CTRE) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, dividends, profitability, institutional ownership, risk and valuation.
Risk & Volatility
Physicians Realty Trust has a beta of 0.53, suggesting that its share price is 47% less volatile than the S&P 500. Comparatively, CareTrust REIT has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500.
Earnings & Valuation
This table compares Physicians Realty Trust and CareTrust REIT’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Physicians Realty Trust||$296.22 million||9.30||$195.49 million||$0.23||76.05|
|CareTrust REIT||$118.79 million||12.20||$96.91 million||$0.45||42.45|
Physicians Realty Trust has higher revenue and earnings than CareTrust REIT. CareTrust REIT is trading at a lower price-to-earnings ratio than Physicians Realty Trust, indicating that it is currently the more affordable of the two stocks.
Physicians Realty Trust pays an annual dividend of $0.92 per share and has a dividend yield of 5.3%. CareTrust REIT pays an annual dividend of $0.74 per share and has a dividend yield of 3.9%. Physicians Realty Trust pays out 400.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CareTrust REIT pays out 164.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This table compares Physicians Realty Trust and CareTrust REIT’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Physicians Realty Trust||11.51%||1.75%||1.10%|
This is a breakdown of current ratings and recommmendations for Physicians Realty Trust and CareTrust REIT, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Physicians Realty Trust||0||3||10||0||2.77|
Physicians Realty Trust presently has a consensus target price of $20.54, indicating a potential upside of 17.45%. CareTrust REIT has a consensus target price of $18.71, indicating a potential downside of 2.02%. Given Physicians Realty Trust’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Physicians Realty Trust is more favorable than CareTrust REIT.
Insider and Institutional Ownership
94.4% of Physicians Realty Trust shares are owned by institutional investors. Comparatively, 89.6% of CareTrust REIT shares are owned by institutional investors. 0.5% of Physicians Realty Trust shares are owned by insiders. Comparatively, 1.6% of CareTrust REIT shares are owned by 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.
CareTrust REIT beats Physicians Realty Trust on 9 of the 16 factors compared between the two stocks.
About Physicians Realty Trust
Physicians Realty Trust (the Trust) is a real estate investment trust. Physicians Realty L.P. is the operating partnership of the Trust. The Trust and its operating partnership are engaged in acquiring, developing, owning and managing healthcare properties that are leased to physicians, hospitals and healthcare delivery systems. As of December 31, 2016, the Company’s portfolio consisted of 246 properties located in 29 states with approximately 10,883,601 net leasable square feet. The Company invests in real estate that is integral to providing healthcare services. The Company focuses its investment activity on various types of healthcare properties, such as medical office buildings; outpatient treatment and diagnostic facilities; physician group practice clinics; ambulatory surgery centers, and specialty hospitals and treatment centers. Its properties include Arrowhead Commons, Aurora Medical Office Building, Decatur Medical Office Building and El Paso Medical Office Building.
About CareTrust REIT
CareTrust REIT, Inc. is a self-administered, self-managed real estate investment trust. The Company is engaged in the ownership, acquisition and leasing of healthcare-related properties. It makes investments in healthcare-related real estate assets. As of December 31, 2016, its real estate portfolio included 154 skilled nursing facilities (SNFs), SNF Campuses, assisted living facilities and independent living facilities. As of December 31, 2016, the 93 facilities leased to The Ensign Group, Inc. had a total of 9,916 beds and units and are located in Arizona, California, Colorado, Idaho, Iowa, Nebraska, Nevada, Texas, Utah and Washington; the 16 facilities leased to affiliates of Pristine Senior Living, LLC had a total of 1,488 beds and units; and the 42 remaining leased properties had a total of 3,515 beds and units and are located in California, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Maryland, Michigan, Minnesota, North Carolina, Texas, Virginia, Washington and Wisconsin.
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