Head-To-Head Analysis: Universal Health Realty Income Trust (NYSE:UHT) and Innovative Industrial Properties (NYSE:IIPR)

Innovative Industrial Properties (NYSE:IIPR) and Universal Health Realty Income Trust (NYSE:UHT) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.

Earnings and Valuation

This table compares Innovative Industrial Properties and Universal Health Realty Income Trust”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Innovative Industrial Properties	$265.95 million	6.82	$118.25 million	$3.91	16.11
Universal Health Realty Income Trust	$99.19 million	6.10	$17.61 million	$1.28	34.03

Innovative Industrial Properties has higher revenue and earnings than Universal Health Realty Income Trust. Innovative Industrial Properties is trading at a lower price-to-earnings ratio than Universal Health Realty Income Trust, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Innovative Industrial Properties has a beta of 1.39, indicating that its share price is 39% more volatile than the S&P 500. Comparatively, Universal Health Realty Income Trust has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500.

Dividends

Innovative Industrial Properties pays an annual dividend of $7.60 per share and has a dividend yield of 12.1%. Universal Health Realty Income Trust pays an annual dividend of $3.00 per share and has a dividend yield of 6.9%. Innovative Industrial Properties pays out 194.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Universal Health Realty Income Trust pays out 234.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Innovative Industrial Properties has increased its dividend for 4 consecutive years and Universal Health Realty Income Trust has increased its dividend for 2 consecutive years. Innovative Industrial Properties is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Innovative Industrial Properties and Universal Health Realty Income Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Innovative Industrial Properties	45.58%	6.62%	5.10%
Universal Health Realty Income Trust	18.00%	11.44%	3.15%

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Innovative Industrial Properties and Universal Health Realty Income Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Innovative Industrial Properties	1	3	0	0	1.75
Universal Health Realty Income Trust	0	1	0	0	2.00

Innovative Industrial Properties presently has a consensus price target of $45.00, suggesting a potential downside of 28.57%. Given Innovative Industrial Properties’ higher probable upside, equities research analysts clearly believe Innovative Industrial Properties is more favorable than Universal Health Realty Income Trust.

Institutional & Insider Ownership

70.6% of Innovative Industrial Properties shares are owned by institutional investors. Comparatively, 64.7% of Universal Health Realty Income Trust shares are owned by institutional investors. 2.0% of Innovative Industrial Properties shares are owned by insiders. Comparatively, 2.6% of Universal Health Realty Income Trust shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Innovative Industrial Properties beats Universal Health Realty Income Trust on 12 of the 16 factors compared between the two stocks.

About Innovative Industrial Properties

Innovative Industrial Properties, Inc. is a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized properties leased to experienced, state-licensed operators for their regulated cannabis facilities. Innovative Industrial Properties, Inc. has elected to be taxed as a real estate investment trust, commencing with the year ended December 31, 2017.

About Universal Health Realty Income Trust

Universal Health Realty Income Trust, a real estate investment trust, invests in healthcare and human-service related facilities including acute care hospitals, behavioral health care hospitals, specialty facilities, medical/office buildings, free-standing emergency departments and childcare centers. We have investments or commitments in seventy-six properties located in twenty-one states.