Critical Analysis: Boardwalk Real Estate Investment Trust (OTCMKTS:BOWFF) versus Broadstone Net Lease (NYSE:BNL)

Broadstone Net Lease (NYSE:BNL) and Boardwalk Real Estate Investment Trust (OTCMKTS:BOWFF) are both mid-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, valuation, risk, profitability, dividends, earnings and analyst recommendations.

Earnings & Valuation

This table compares Broadstone Net Lease and Boardwalk Real Estate Investment Trust”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Broadstone Net Lease	$447.97 million	8.18	$162.44 million	$0.47	41.22
Boardwalk Real Estate Investment Trust	$440.33 million	5.56	$429.28 million	$3.09	16.25

Boardwalk Real Estate Investment Trust has lower revenue, but higher earnings than Broadstone Net Lease. Boardwalk Real Estate Investment Trust is trading at a lower price-to-earnings ratio than Broadstone Net Lease, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

89.1% of Broadstone Net Lease shares are owned by institutional investors. 0.6% of Broadstone Net Lease shares are owned by company insiders. Comparatively, 19.0% of Boardwalk Real Estate Investment Trust shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Broadstone Net Lease and Boardwalk Real Estate Investment Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Broadstone Net Lease	20.04%	2.93%	1.69%
Boardwalk Real Estate Investment Trust	49.45%	6.30%	3.54%

Dividends

Broadstone Net Lease pays an annual dividend of $1.16 per share and has a dividend yield of 6.0%. Boardwalk Real Estate Investment Trust pays an annual dividend of $1.18 per share and has a dividend yield of 2.3%. Broadstone Net Lease pays out 246.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Boardwalk Real Estate Investment Trust pays out 38.2% of its earnings in the form of a dividend. Broadstone Net Lease has raised its dividend for 4 consecutive years. Broadstone Net Lease is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Broadstone Net Lease has a beta of 1, suggesting that its stock price has a similar volatility profile to the S&P 500.Comparatively, Boardwalk Real Estate Investment Trust has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Broadstone Net Lease and Boardwalk Real Estate Investment Trust, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Broadstone Net Lease	0	3	9	0	2.75
Boardwalk Real Estate Investment Trust	0	0	0	0	0.00

Broadstone Net Lease currently has a consensus price target of $19.91, suggesting a potential upside of 2.76%. Given Broadstone Net Lease’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Broadstone Net Lease is more favorable than Boardwalk Real Estate Investment Trust.

Summary

Broadstone Net Lease beats Boardwalk Real Estate Investment Trust on 10 of the 17 factors compared between the two stocks.

About Broadstone Net Lease

Broadstone Net Lease, Inc. (the Corporation) is a Maryland corporation formed on October 18, 2007, that elected to be taxed as a real estate investment trust (REIT) commencing with the taxable year ended December 31, 2008. Broadstone Net Lease, LLC (the Corporation’s operating company, or the OP), is the entity through which the Corporation conducts its business and owns (either directly or through subsidiaries) all of the Corporation’s properties. The Corporation is the sole managing member of the OP. The membership units not owned by the Corporation are referred to as OP Units or non-controlling interests. As the Corporation conducts substantially all of its operations through the OP, it is structured as what is referred to as an umbrella partnership real estate investment trust (UPREIT). The Corporation’s common stock is listed on the New York Stock Exchange under the symbol BNL.

About Boardwalk Real Estate Investment Trust

Boardwalk REIT strives to be Canada’s friendliest community provider and is a leading owner/operator of multi-family rental communities. Providing homes in more than 200 communities, with over 34,000 residential suites totaling over 29 million net rentable square feet, Boardwalk has a proven long-term track record of building better communities, where love always lives. Our three-tiered and distinct brands: Boardwalk Living, Boardwalk Communities, and Boardwalk Lifestyle, cater to a large diverse demographic and has evolved to capture the life cycle of all Resident Members. Boardwalk’s disciplined approach to capital allocation, acquisition, development, purposeful re-positioning, and management of apartment communities allows the Trust to provide its brand of community across Canada creating exceptional Resident Member experiences. Differentiated by its peak performance culture, Boardwalk is committed to delivering exceptional service, product quality and experience to our Resident Members who reward us with high retention and market leading operating results, which in turn, lead to higher free cash flow and investment returns, stable monthly distributions, and value creation for all our stakeholders. Boardwalk REIT’s Trust Units are listed on the Toronto Stock Exchange, trading under the symbol BEI.UN.