Innovative Industrial Properties (IIPR) versus Corecivic (CXW) Head to Head Analysis

Innovative Industrial Properties (NYSE: IIPR) and Corecivic (NYSE:CXW) are both specialized reits – nec companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, analyst recommendations, risk and valuation.

Earnings and Valuation

This table compares Innovative Industrial Properties and Corecivic’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Innovative Industrial Properties $320,000.00 284.48 -$4.39 million ($0.63) -41.29
Corecivic $1.85 billion 1.44 $219.91 million $1.67 13.53

Corecivic has higher revenue and earnings than Innovative Industrial Properties. Innovative Industrial Properties is trading at a lower price-to-earnings ratio than Corecivic, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Innovative Industrial Properties and Corecivic, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Innovative Industrial Properties 0 0 1 0 3.00
Corecivic 0 1 3 0 2.75

Innovative Industrial Properties presently has a consensus target price of $23.00, indicating a potential downside of 11.57%. Corecivic has a consensus target price of $36.00, indicating a potential upside of 59.36%. Given Corecivic’s higher possible upside, analysts plainly believe Corecivic is more favorable than Innovative Industrial Properties.

Profitability

This table compares Innovative Industrial Properties and Corecivic’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Innovative Industrial Properties -108.39% -8.09% -7.47%
Corecivic 11.03% 13.54% 6.10%

Insider and Institutional Ownership

8.6% of Innovative Industrial Properties shares are owned by institutional investors. Comparatively, 83.2% of Corecivic shares are owned by institutional investors. 10.6% of Innovative Industrial Properties shares are owned by insiders. Comparatively, 1.3% of Corecivic shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

Innovative Industrial Properties pays an annual dividend of $1.00 per share and has a dividend yield of 3.8%. Corecivic pays an annual dividend of $1.68 per share and has a dividend yield of 7.4%. Innovative Industrial Properties pays out -158.7% of its earnings in the form of a dividend. Corecivic pays out 100.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Corecivic has raised its dividend for 4 consecutive years. Corecivic is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Corecivic beats Innovative Industrial Properties on 12 of the 16 factors compared between the two stocks.

About Innovative Industrial Properties

Innovative Industrial Properties, Inc. is focused on the acquisition, ownership and management of specialized industrial properties leased to state-licensed operators for their regulated medical-use cannabis facilities. The Company intends to acquire its properties through sale-leaseback transactions and third-party purchases. It is focused on leasing its properties on a triple-net lease basis, where the tenant is responsible for all aspects of and costs related to the property and its operation during the lease term, including maintenance, taxes and insurance. The Company intends to conduct business in an umbrella partnership real estate investment trust (UPREIT), structure through its operating partnership. The Company’s real estate investments will consist of primarily properties suitable for cultivation and production of medical-use cannabis.

About Corecivic

CoreCivic, Inc., formerly Corrections Corporation of America, is a diversified government solutions company. The Company provides partnership correctional, detention and residential reentry facilities and operates prison in the United States. The Company’s business offerings include CoreCivic Safety, CoreCivic Properties, and CoreCivic Community. The Company provides a range of solutions to government partners that serve the public good corrections and detention management, government real estate solutions, and network of residential reentry centers. As of March 31, 2017, the Company owned or controlled 48 correctional and detention facilities, owned or controlled 27 residential reentry centers, and managed an additional 11 correctional and detention facilities owned by its government partners, with a total design capacity of approximately 88,400 beds in 20 states.

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