Comparing Diversified Healthcare Trust (NASDAQ:DHC) & Four Corners Property Trust (NYSE:FCPT)

Diversified Healthcare Trust (NASDAQ:DHC) and Four Corners Property Trust (NYSE:FCPT) are both mid-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, profitability, valuation, institutional ownership, risk, earnings and analyst recommendations.

Institutional and Insider Ownership

76.0% of Diversified Healthcare Trust shares are held by institutional investors. Comparatively, 98.7% of Four Corners Property Trust shares are held by institutional investors. 10.2% of Diversified Healthcare Trust shares are held by insiders. Comparatively, 1.2% of Four Corners Property Trust shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations for Diversified Healthcare Trust and Four Corners Property Trust, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Diversified Healthcare Trust	1	2	2	1	2.50
Four Corners Property Trust	0	5	4	0	2.44

Diversified Healthcare Trust currently has a consensus target price of $9.83, suggesting a potential upside of 7.25%. Four Corners Property Trust has a consensus target price of $28.12, suggesting a potential upside of 11.19%. Given Four Corners Property Trust’s higher probable upside, analysts clearly believe Four Corners Property Trust is more favorable than Diversified Healthcare Trust.

Earnings & Valuation

This table compares Diversified Healthcare Trust and Four Corners Property Trust”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Diversified Healthcare Trust	$1.54 billion	1.44	-$285.89 million	($1.33)	-6.89
Four Corners Property Trust	$294.13 million	9.44	$112.36 million	$1.12	22.58

Four Corners Property Trust has lower revenue, but higher earnings than Diversified Healthcare Trust. Diversified Healthcare Trust is trading at a lower price-to-earnings ratio than Four Corners Property Trust, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Diversified Healthcare Trust and Four Corners Property Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Diversified Healthcare Trust	-21.10%	-18.75%	-7.09%
Four Corners Property Trust	38.74%	7.38%	4.06%

Risk & Volatility

Diversified Healthcare Trust has a beta of 2.28, suggesting that its share price is 128% more volatile than the S&P 500. Comparatively, Four Corners Property Trust has a beta of 0.8, suggesting that its share price is 20% less volatile than the S&P 500.

Dividends

Diversified Healthcare Trust pays an annual dividend of $0.04 per share and has a dividend yield of 0.4%. Four Corners Property Trust pays an annual dividend of $1.47 per share and has a dividend yield of 5.8%. Diversified Healthcare Trust pays out -3.0% of its earnings in the form of a dividend. Four Corners Property Trust pays out 131.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Four Corners Property Trust has raised its dividend for 5 consecutive years. Four Corners Property Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Four Corners Property Trust beats Diversified Healthcare Trust on 12 of the 18 factors compared between the two stocks.

About Diversified Healthcare Trust

Diversified Healthcare Trust is a real estate investment trust, which engages in the ownership of senior living communities, medical office buildings, and wellness centers. It operates through the following segments: Office Portfolio, Senior Housing Operating Portfolio (SHOP), and Non-Segment. The Office Portfolio segment consists of medical office properties leased to medical providers and other medical related businesses, as well as life science properties leased to biotech laboratories and other similar tenants. The SHOP segment manages senior living communities that offers short term and long term residential care, and other services for residents where it pay fees to the operator to manage the communities for its account. The company was founded on December 16, 1998 and is headquartered in Newton, MA.

About Four Corners Property Trust

Four Corners Property Trust, Inc. engages in the owning, acquisition, and leasing of properties for use in the restaurant and food-service related industries. It operates through the Real Estate Operations and Restaurant Operations segments. The Real Estate Operations segment consists of rental revenues generated by leasing restaurant properties. The Restaurant Operations segment includes the Kerrow Restaurant operating business. The company was founded on July 2, 2015 and is headquartered in Mill Valley, CA.