Office Properties Income Trust (NASDAQ:OPI) versus UMH Properties (NYSE:UMH) Critical Review

UMH Properties (NYSE:UMH) and Office Properties Income Trust (NASDAQ:OPI) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, analyst recommendations, valuation, institutional ownership, risk, earnings and dividends.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for UMH Properties and Office Properties Income Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
UMH Properties	0	3	2	0	2.40
Office Properties Income Trust	1	0	0	0	1.00

UMH Properties presently has a consensus target price of $18.50, suggesting a potential upside of 22.27%. Given UMH Properties’ stronger consensus rating and higher probable upside, analysts clearly believe UMH Properties is more favorable than Office Properties Income Trust.

Earnings & Valuation

This table compares UMH Properties and Office Properties Income Trust”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
UMH Properties	$256.66 million	5.02	$21.64 million	$0.08	189.13
Office Properties Income Trust	$466.97 million	0.00	-$136.11 million	($4.90)	0.00

UMH Properties has higher earnings, but lower revenue than Office Properties Income Trust. Office Properties Income Trust is trading at a lower price-to-earnings ratio than UMH Properties, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

UMH Properties has a beta of 1.06, suggesting that its stock price is 6% more volatile than the S&P 500. Comparatively, Office Properties Income Trust has a beta of 1.71, suggesting that its stock price is 71% more volatile than the S&P 500.

Profitability

This table compares UMH Properties and Office Properties Income Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
UMH Properties	12.18%	5.19%	1.96%
Office Properties Income Trust	-62.99%	-25.56%	-8.02%

Insider & Institutional Ownership

75.4% of UMH Properties shares are held by institutional investors. Comparatively, 64.4% of Office Properties Income Trust shares are held by institutional investors. 8.8% of UMH Properties shares are held by company insiders. Comparatively, 1.8% of Office Properties Income Trust shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

UMH Properties pays an annual dividend of $0.90 per share and has a dividend yield of 5.9%. Office Properties Income Trust pays an annual dividend of $0.04 per share and has a dividend yield of 250.0%. UMH Properties pays out 1,125.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Office Properties Income Trust pays out -0.8% of its earnings in the form of a dividend. UMH Properties has increased its dividend for 4 consecutive years. Office Properties Income Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

UMH Properties beats Office Properties Income Trust on 13 of the 17 factors compared between the two stocks.

About UMH Properties

UMH Properties, Inc., which was organized in 1968, is a public equity REIT that owns and operates 135 manufactured home communities containing approximately 25,800 developed homesites. These communities are located in New Jersey, New York, Ohio, Pennsylvania, Tennessee, Indiana, Michigan, Maryland, Alabama, South Carolina and Georgia. UMH also has an ownership interest in and operates two communities in Florida, containing 363 sites, through its joint venture with Nuveen Real Estate

About Office Properties Income Trust

Office Properties Income Trust is a real estate investment trust. It owns, operates, and leases office buildings to single tenants and multi-tenant buildings. The company was founded on February 17, 2009 and is headquartered in Newton, MA.