Washington Prime Group (NYSE: WPG) and Saul Centers (NYSE:BFS) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, earnings, institutional ownership, profitability, dividends, analyst recommendations and valuation.

Earnings and Valuation

This table compares Washington Prime Group and Saul Centers’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Washington Prime Group $843.47 million 1.51 $67.13 million $0.86 7.97
Saul Centers $217.07 million 6.25 $45.27 million $1.63 37.98

Washington Prime Group has higher revenue and earnings than Saul Centers. Washington Prime Group is trading at a lower price-to-earnings ratio than Saul Centers, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Washington Prime Group has a beta of 0.88, indicating that its stock price is 12% less volatile than the S&P 500. Comparatively, Saul Centers has a beta of 0.72, indicating that its stock price is 28% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and target prices for Washington Prime Group and Saul Centers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Washington Prime Group 1 0 0 0 1.00
Saul Centers 0 1 1 0 2.50

Profitability

This table compares Washington Prime Group and Saul Centers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Washington Prime Group 21.85% 16.17% 3.57%
Saul Centers 21.42% 23.93% 3.44%

Dividends

Washington Prime Group pays an annual dividend of $1.00 per share and has a dividend yield of 14.6%. Saul Centers pays an annual dividend of $2.04 per share and has a dividend yield of 3.3%. Washington Prime Group pays out 116.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Saul Centers pays out 125.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Saul Centers has increased its dividend for 3 consecutive years. Washington Prime Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

89.9% of Washington Prime Group shares are held by institutional investors. Comparatively, 45.5% of Saul Centers shares are held by institutional investors. 0.3% of Washington Prime Group shares are held by company insiders. Comparatively, 48.8% of Saul Centers shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

About Washington Prime Group

Washington Prime Group Inc. (WPG Inc.), formerly WP Glimcher Inc., operates as a self-administered and self-managed real estate investment trust (REIT). The Company’s primary business is the ownership, development and management of retail real estate within the United States. The Company owns, develops and manages enclosed retail properties and community centers. As of December 31, 2016, its assets consisted of material interests in 114 shopping centers in the United States, consisting of approximately 63 million square feet of gross leasable area. The Company also owns parcels of land, which can be used for either the development of new shopping centers or the expansion of existing properties. Washington Prime Group, L.P. is the Company’s majority-owned partnership subsidiary that owns, develops and manages, through its affiliates, all of WPG Inc.’s real estate properties and other assets. Its properties include Irving Mall, Lindale Mall, Markland Plaza and Royal Eagle Plaza.

About Saul Centers

Saul Centers, Inc. operates as a real estate investment trust. The Company’s principal business activity is the ownership, management and development of income-producing properties. It operates through two segments: Shopping Centers and Mixed-Use Properties. The Company, which conducts all of its activities through its subsidiaries, the Saul Holdings Limited Partnership (Operating Partnership) and Subsidiary Partnerships, engages in the ownership, operation, management, leasing, acquisition, renovation, expansion, development and financing of community and neighborhood shopping centers and mixed-used properties in the Washington, District of Columbia/Baltimore metropolitan area. As of December 31, 2016, it properties (the Current Portfolio Properties) consisted of 49 shopping center properties (the Shopping Centers), six mixed-use properties, which consists of office, retail and multi-family residential uses (the Mixed-Use Properties) and three (non-operating) development properties.

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