TIER REIT (NYSE: TIER) and Parkway (NYSE:PKY) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, profitability, institutional ownership and earnings.
Valuation & Earnings
This table compares TIER REIT and Parkway’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|TIER REIT||$242.82 million||3.87||-$29.41 million||$1.82||10.80|
TIER REIT pays an annual dividend of $0.72 per share and has a dividend yield of 3.7%. Parkway pays an annual dividend of $0.40 per share and has a dividend yield of 2.1%. TIER REIT pays out 39.6% of its earnings in the form of a dividend.
This table compares TIER REIT and Parkway’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider and Institutional Ownership
57.6% of TIER REIT shares are owned by institutional investors. Comparatively, 97.1% of Parkway shares are owned by institutional investors. 1.2% of TIER REIT shares are owned by company insiders. Comparatively, 4.9% of Parkway shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
This is a summary of recent recommendations and price targets for TIER REIT and Parkway, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
TIER REIT currently has a consensus price target of $20.50, indicating a potential upside of 4.33%. Parkway has a consensus price target of $23.25, indicating a potential upside of 22.11%. Given Parkway’s higher possible upside, analysts clearly believe Parkway is more favorable than TIER REIT.
TIER REIT beats Parkway on 7 of the 11 factors compared between the two stocks.
TIER REIT Company Profile
TIER REIT, Inc. is a real estate investment trust. The Company’s business consists of owning, acquiring, developing, operating, investing in, and disposing of real estate assets. The Company’s business is conducted through Tier Operating Partnership LP (Tier OP). As of December 31, 2016, the Company owned interests in 29 operating office properties, one non-operating property and one development property located in 13 markets throughout the United States. It owns properties located in metropolitan cities and suburban markets in the United States. The Company’s office properties include The Terrace Office Park, Domain 3, Domain 4, 5950 Sherry Lane, Burnett Plaza, Loop Central, One BriarLake Plaza, Three Eldridge Place, Eisenhower I, Forum Office Park, 500 E. Pratt, Woodcrest Corporate Center and 111 Woodcrest. The Company’s properties are located in Austin, Dallas, Houston, Charlotte, Nashville, Atlanta and Denver.
Parkway Company Profile
Parkway, Inc. is a self-managed real estate investment trust (REIT). The Company owns and operates office properties located in submarkets in Houston, Texas. As of December 31, 2016, the Company’s portfolio consisted of five Class A assets comprising 19 buildings and totaling approximately 8.7 million rentable square feet in the Greenway, Galleria and Westchase submarkets of Houston. In addition, the Company operates a fee-based real estate service (the Third-Party Services Business) through a subsidiary, Eola Office Partners, LLC and its subsidiaries (collectively, Eola), which in total managed approximately 3.8 million square feet (unaudited) for primarily third-party owners, as of December 31, 2016. The Company’s properties include CityWestPlace, San Felipe Plaza, Phoenix Tower, Greenway Plaza and Post Oak Central.
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