Contrasting NRF Holdco (NRF) & Liberty Property Trust (LPT)

NRF Holdco (NYSE: NRF) and Liberty Property Trust (NYSE:LPT) are both mid-cap financials companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, profitability, dividends, valuation, analyst recommendations, risk and earnings.

Dividends

NRF Holdco pays an annual dividend of $1.60 per share and has a dividend yield of 9.9%. Liberty Property Trust pays an annual dividend of $1.60 per share and has a dividend yield of 4.0%. NRF Holdco pays out -88.9% of its earnings in the form of a dividend. Liberty Property Trust pays out 83.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NRF Holdco has increased its dividend for 3 consecutive years. NRF Holdco is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for NRF Holdco and Liberty Property Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NRF Holdco 0 0 0 0 N/A
Liberty Property Trust 1 5 3 0 2.22

Liberty Property Trust has a consensus price target of $42.33, suggesting a potential upside of 6.82%. Given Liberty Property Trust’s higher probable upside, analysts clearly believe Liberty Property Trust is more favorable than NRF Holdco.

Risk and Volatility

NRF Holdco has a beta of 1.73, suggesting that its share price is 73% more volatile than the S&P 500. Comparatively, Liberty Property Trust has a beta of 0.76, suggesting that its share price is 24% less volatile than the S&P 500.

Profitability

This table compares NRF Holdco and Liberty Property Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NRF Holdco -16.61% -17.86% -2.44%
Liberty Property Trust 37.90% 8.59% 4.24%

Valuation and Earnings

This table compares NRF Holdco and Liberty Property Trust’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
NRF Holdco N/A N/A N/A ($1.80) -8.96
Liberty Property Trust $719.78 million 8.12 $282.34 million $1.91 20.75

Liberty Property Trust has higher revenue and earnings than NRF Holdco. NRF Holdco is trading at a lower price-to-earnings ratio than Liberty Property Trust, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

69.7% of NRF Holdco shares are held by institutional investors. Comparatively, 91.5% of Liberty Property Trust shares are held by institutional investors. 2.4% of NRF Holdco shares are held by insiders. Comparatively, 1.5% of Liberty Property Trust shares are held 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.

Summary

Liberty Property Trust beats NRF Holdco on 9 of the 14 factors compared between the two stocks.

NRF Holdco Company Profile

NRF Holdco LLC. is a commercial real estate company. The Company invests in multiple asset classes across commercial real estate (CRE). Its portfolio consists of healthcare, hotel, manufactured housing communities, net lease and multifamily properties. The Company also invests in other opportunistic real estate investments, such as indirect interests in real estate through its investments in private equity funds (PE Investments). The Company also acquires and operates hotel and certain healthcare properties. The Company’s segments include Real Estate, Commercial Real Estate Debt (CRE debt), Commercial Real Estate Securities, N-Star CDOs and Corporate. Its real estate equity investments that operate under the REIT Investment Diversification and Empowerment Act (RIDEA) structure generate resident and hotel guest related income from short-term residential agreements. The Company is externally managed and advised by an affiliate of NorthStar Asset Management Group Inc.

Liberty Property Trust Company Profile

Liberty Property Trust (the Trust) is a self-administered and self-managed Maryland real estate investment trust (REIT). The Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership (the Operating Partnership). The Company’s segments include Carolinas/Richmond; Chicago/Milwaukee; Florida; Houston; Lehigh/Central PA; Minnesota; Philadelphia; Southeastern PA; United Kingdom, and Other, which includes Arizona; Atlanta; Cincinnati/Columbus/Indianapolis; Dallas; DC Metro; New Jersey; Southern California, and other. The Company owns and operates industrial properties nationally and owns and operates office properties in a focused group of office markets. Additionally, the Company owns certain assets in the United Kingdom. As of December 31, 2016, the Company owned and operated 450 industrial and 55 office properties totaling 86.0 million square feet.

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