DDR (NYSE: DDR) and Cedar Realty Trust (NYSE:CDR) are both finance companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, earnings, institutional ownership, risk, profitability and valuation.
Risk and Volatility
DDR has a beta of 0.6, suggesting that its share price is 40% less volatile than the S&P 500. Comparatively, Cedar Realty Trust has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500.
DDR pays an annual dividend of $0.76 per share and has a dividend yield of 10.7%. Cedar Realty Trust pays an annual dividend of $0.20 per share and has a dividend yield of 4.9%. DDR pays out -1,900.0% of its earnings in the form of a dividend. Cedar Realty Trust pays out -666.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Cedar Realty Trust has increased its dividend for 7 consecutive years. DDR is clearly the better dividend stock, given its higher yield and lower payout ratio.
This is a breakdown of current recommendations and price targets for DDR and Cedar Realty Trust, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Cedar Realty Trust||1||2||3||0||2.33|
DDR currently has a consensus target price of $11.13, indicating a potential upside of 57.36%. Cedar Realty Trust has a consensus target price of $5.69, indicating a potential upside of 38.05%. Given DDR’s higher possible upside, equities research analysts clearly believe DDR is more favorable than Cedar Realty Trust.
This table compares DDR and Cedar Realty Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Cedar Realty Trust||13.11%||4.71%||1.53%|
Institutional and Insider Ownership
78.9% of DDR shares are owned by institutional investors. Comparatively, 95.1% of Cedar Realty Trust shares are owned by institutional investors. 16.1% of DDR shares are owned by company insiders. Comparatively, 4.5% of Cedar Realty Trust shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares DDR and Cedar Realty Trust’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|DDR||$969.51 million||2.69||$60.01 million||($0.04)||-176.75|
|Cedar Realty Trust||$146.01 million||2.58||$19.14 million||($0.03)||-137.33|
DDR has higher revenue and earnings than Cedar Realty Trust. DDR is trading at a lower price-to-earnings ratio than Cedar Realty Trust, indicating that it is currently the more affordable of the two stocks.
Cedar Realty Trust beats DDR on 9 of the 17 factors compared between the two stocks.
DDR Corp. is a self-administered and self-managed real estate investment trust. It operates through two segments: shopping centers and loan investments. It is in the business of acquiring, owning, developing, redeveloping, expanding, leasing and managing shopping centers. As of December 31, 2016, it owned and managed approximately 106 million total square feet of gross leasable area (GLA). As of December 31, 2016, the portfolio properties included 319 shopping centers (including 152 centers owned through joint ventures). As of December 31, 2016, the portfolio properties also included over 650 acres of undeveloped land, including parcels located adjacent to certain of the shopping centers. As of December 31, 2016, the portfolio properties aggregated to 75.8 million square feet of Company-owned GLA located in 35 states, plus Puerto Rico. These centers are in the Southeast and Midwest, with significant concentrations in Florida, Georgia, Ohio and North Carolina, as well as Puerto Rico.
About Cedar Realty Trust
Cedar Realty Trust, Inc. is a real estate investment trust (REIT). The Company focuses on ownership and operation of grocery-anchored shopping centers straddling the Washington District of Columbia (DC) to Boston corridor. As of December 31, 2016, the Company owned and managed a portfolio of 61 operating properties (excluding properties held for sale) totaling approximately 9.1 million square feet of gross leasable area (GLA). The Company focuses its investment activities on grocery-anchored shopping centers. The Company’s properties portfolio comprises 26 properties in Pennsylvania, eight properties in Massachusetts, seven properties in Connecticut, seven properties in Maryland / Washington, D.C, eight properties in Virginia, four properties in New Jersey and one property in New York. The Company’s 106 are going to expire in the year 2017. The Company conducts all of its businesses through the Cedar Realty Trust Partnership L.P. (the Operating Partnership).
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