Reviewing NexPoint Residential Trust (NYSE:NXRT) and LXP Industrial Trust (NYSE:LXP)

NexPoint Residential Trust (NYSE:NXRT) and LXP Industrial Trust (NYSE:LXP) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, valuation, earnings and risk.

Insider & Institutional Ownership

76.6% of NexPoint Residential Trust shares are held by institutional investors. Comparatively, 93.5% of LXP Industrial Trust shares are held by institutional investors. 15.4% of NexPoint Residential Trust shares are held by insiders. Comparatively, 2.2% of LXP Industrial Trust shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares NexPoint Residential Trust and LXP Industrial Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NexPoint Residential Trust	-19.23%	-13.32%	-2.60%
LXP Industrial Trust	32.19%	5.86%	3.12%

Dividends

NexPoint Residential Trust pays an annual dividend of $2.04 per share and has a dividend yield of 7.0%. LXP Industrial Trust pays an annual dividend of $2.70 per share and has a dividend yield of 5.6%. NexPoint Residential Trust pays out -106.3% of its earnings in the form of a dividend. LXP Industrial Trust pays out 142.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NexPoint Residential Trust has increased its dividend for 3 consecutive years and LXP Industrial Trust has increased its dividend for 3 consecutive years. NexPoint Residential Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a summary of recent ratings for NexPoint Residential Trust and LXP Industrial Trust, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NexPoint Residential Trust	2	6	0	0	1.75
LXP Industrial Trust	0	3	4	0	2.57

NexPoint Residential Trust currently has a consensus target price of $40.13, suggesting a potential upside of 37.11%. LXP Industrial Trust has a consensus target price of $54.00, suggesting a potential upside of 11.53%. Given NexPoint Residential Trust’s higher possible upside, equities research analysts clearly believe NexPoint Residential Trust is more favorable than LXP Industrial Trust.

Risk and Volatility

NexPoint Residential Trust has a beta of 1.17, suggesting that its stock price is 17% more volatile than the S&P 500. Comparatively, LXP Industrial Trust has a beta of 1.11, suggesting that its stock price is 11% more volatile than the S&P 500.

Valuation & Earnings

This table compares NexPoint Residential Trust and LXP Industrial Trust”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NexPoint Residential Trust	$259.70 million	2.86	$1.11 million	($1.92)	-15.24
LXP Industrial Trust	$358.46 million	7.99	$44.53 million	$1.90	25.48

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

Summary

LXP Industrial Trust beats NexPoint Residential Trust on 11 of the 16 factors compared between the two stocks.

About NexPoint Residential Trust

NexPoint Residential Trust is a publicly traded REIT, with its shares listed on the New York Stock Exchange under the symbol “NXRT,” primarily focused on acquiring, owning and operating well-located middle-income multifamily properties with “value-add” potential in large cities and suburban submarkets of large cities, primarily in the Southeastern and Southwestern United States. NXRT is externally advised by NexPoint Real Estate Advisors, L.P., an affiliate of NexPoint Advisors, L.P., an SEC-registered investment advisor, which has extensive real estate experience.

About LXP Industrial Trust

LXP Industrial Trust (NYSE: LXP) is a publicly traded real estate investment trust (REIT) focused on single-tenant industrial real estate investments across the United States. LXP seeks to expand its industrial portfolio through acquisitions, build-to-suit transactions, sale-leaseback transactions, development projects and other transactions.