Safety Income & Growth (NYSE: SAFE) and Investors Real Estate Trust (NYSE:IRET) are both small-cap financials companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, profitability, valuation and risk.

Institutional and Insider Ownership

40.3% of Safety Income & Growth shares are held by institutional investors. Comparatively, 53.4% of Investors Real Estate Trust shares are held by institutional investors. 1.0% of Investors Real Estate Trust shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Safety Income & Growth and Investors Real Estate Trust’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Safety Income & Growth $21.74 million 14.85 $6.61 million N/A N/A
Investors Real Estate Trust $205.74 million 3.46 $43.34 million ($0.13) -45.46

Investors Real Estate Trust has higher revenue and earnings than Safety Income & Growth.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Safety Income & Growth and Investors Real Estate Trust, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Safety Income & Growth 0 5 1 0 2.17
Investors Real Estate Trust 0 2 0 0 2.00

Safety Income & Growth currently has a consensus target price of $20.58, indicating a potential upside of 15.94%. Investors Real Estate Trust has a consensus target price of $6.75, indicating a potential upside of 14.21%. Given Safety Income & Growth’s stronger consensus rating and higher probable upside, research analysts plainly believe Safety Income & Growth is more favorable than Investors Real Estate Trust.

Dividends

Investors Real Estate Trust pays an annual dividend of $0.28 per share and has a dividend yield of 4.7%. Safety Income & Growth does not pay a dividend. Investors Real Estate Trust pays out -215.4% of its earnings in the form of a dividend.

Profitability

This table compares Safety Income & Growth and Investors Real Estate Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Safety Income & Growth -11.52% -0.81% -0.44%
Investors Real Estate Trust 25.72% 0.11% 0.03%

Summary

Investors Real Estate Trust beats Safety Income & Growth on 9 of the 13 factors compared between the two stocks.

About Safety Income & Growth

Safety, Income and Growth, Inc. is formed primarily to acquire, own, manage, finance and capitalize ground net leases (GNLs). The Company’s portfolio consists of 12 properties, which includes Doubletree Seattle Airport, One Ally Center, Hilton Salt Lake, Doubletree Mission Valley, Doubletree Sonoma, Doubletree Durango, Dallas Market Center: Sheraton Suites, Northside Forsyth Hospital Medical Center, NASA/JPSS Headquarters, The Buckler Apartments, Dallas Market Center: Marriott Courtyard and Lock Up Self Storage Facility.

About Investors Real Estate Trust

Investors Real Estate Trust is a self-advised equity real estate investment trust (REIT). The Company’s business consists of owning and operating income-producing real estate properties. Its segments include Multifamily, Healthcare and All Other. Its investments consist of multifamily and healthcare properties located primarily in the upper Midwest states of Minnesota and North Dakota. It conducts its business operations through its operating partnership, IRET Properties, which is principally engaged in acquiring, owning, operating and leasing real estate. It invests in multifamily properties and commercial properties that are leased to single or multiple tenants, usually for approximately five years or longer. As of May 26, 2017, the Company held for investment 86 multifamily properties containing 12,813 apartment units and 44 commercial properties, consisting of healthcare, industrial, office and retail, containing approximately 2.7 million square feet of leasable space.

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