City Office REIT (NYSE:CIO – Get Free Report) and Community Healthcare Trust (NYSE:CHCT – Get Free Report) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, profitability, earnings, valuation, dividends, institutional ownership and risk.
Dividends
City Office REIT pays an annual dividend of $0.40 per share and has a dividend yield of 8.0%. Community Healthcare Trust pays an annual dividend of $1.84 per share and has a dividend yield of 7.9%. City Office REIT pays out -142.9% of its earnings in the form of a dividend. Community Healthcare Trust pays out 287.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. City Office REIT is clearly the better dividend stock, given its higher yield and lower payout ratio.
Insider & Institutional Ownership
67.5% of City Office REIT shares are held by institutional investors. Comparatively, 87.8% of Community Healthcare Trust shares are held by institutional investors. 3.9% of City Office REIT shares are held by company insiders. Comparatively, 4.0% of Community Healthcare Trust shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Earnings & Valuation
Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
City Office REIT | $179.10 million | 1.12 | -$2.68 million | ($0.28) | -17.86 |
Community Healthcare Trust | $112.85 million | 5.68 | $7.71 million | $0.64 | 36.17 |
Community Healthcare Trust has lower revenue, but higher earnings than City Office REIT. City Office REIT is trading at a lower price-to-earnings ratio than Community Healthcare Trust, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
City Office REIT has a beta of 1.91, meaning that its stock price is 91% more volatile than the S&P 500. Comparatively, Community Healthcare Trust has a beta of 0.68, meaning that its stock price is 32% less volatile than the S&P 500.
Profitability
This table compares City Office REIT and Community Healthcare Trust’s net margins, return on equity and return on assets.
Net Margins | Return on Equity | Return on Assets | |
City Office REIT | -2.24% | -0.60% | -0.26% |
Community Healthcare Trust | 15.91% | 3.57% | 1.93% |
Analyst Recommendations
This is a summary of current ratings and recommmendations for City Office REIT and Community Healthcare Trust, as provided by MarketBeat.
Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
City Office REIT | 0 | 1 | 0 | 0 | 2.00 |
Community Healthcare Trust | 0 | 3 | 1 | 0 | 2.25 |
Community Healthcare Trust has a consensus price target of $28.67, suggesting a potential upside of 23.83%. Given Community Healthcare Trust’s stronger consensus rating and higher possible upside, analysts plainly believe Community Healthcare Trust is more favorable than City Office REIT.
Summary
Community Healthcare Trust beats City Office REIT on 12 of the 16 factors compared between the two stocks.
About City Office REIT
City Office REIT is an internally-managed real estate company focused on acquiring, owning and operating high-quality office properties located predominantly in Sun Belt markets. City Office currently owns or has a controlling interest in 5.7 million square feet of office properties. The Company has elected to be taxed as a real estate investment trust for U.S. federal income tax purposes.
About Community Healthcare Trust
Community Healthcare Trust Incorporated is a real estate investment trust that focuses on owning income-producing real estate properties associated primarily with the delivery of outpatient healthcare services in our target sub-markets throughout the United States. As of December 31, 2023, the Company had investments of approximately $1.1 billion in 193 real estate properties (including a portion of one property accounted for as a sales-type lease and two properties classified as held for sale). The properties are located in 34 states, totaling approximately 4.3 million square feet in the aggregate.
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