Financial Contrast: Rithm Capital (NYSE:RITM) vs. Healthcare Realty Trust (NYSE:HR)

Healthcare Realty Trust (NYSE:HR) and Rithm Capital (NYSE:RITM) are both mid-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Institutional and Insider Ownership

44.9% of Rithm Capital shares are held by institutional investors. 0.6% of Healthcare Realty Trust shares are held by company insiders. Comparatively, 0.4% of Rithm Capital shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Volatility & Risk

Healthcare Realty Trust has a beta of 0.93, meaning that its stock price is 7% less volatile than the S&P 500. Comparatively, Rithm Capital has a beta of 1.8, meaning that its stock price is 80% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Healthcare Realty Trust and Rithm Capital, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Healthcare Realty Trust	1	5	0	0	1.83
Rithm Capital	0	1	7	0	2.88

Healthcare Realty Trust currently has a consensus target price of $17.50, suggesting a potential upside of 3.24%. Rithm Capital has a consensus target price of $12.94, suggesting a potential upside of 19.46%. Given Rithm Capital’s stronger consensus rating and higher probable upside, analysts plainly believe Rithm Capital is more favorable than Healthcare Realty Trust.

Valuation & Earnings

This table compares Healthcare Realty Trust and Rithm Capital”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Healthcare Realty Trust	$1.34 billion	4.47	-$278.26 million	($1.58)	-10.73
Rithm Capital	$2.29 billion	2.46	$622.26 million	$0.99	10.94

Rithm Capital has higher revenue and earnings than Healthcare Realty Trust. Healthcare Realty Trust is trading at a lower price-to-earnings ratio than Rithm Capital, indicating that it is currently the more affordable of the two stocks.

Dividends

Healthcare Realty Trust pays an annual dividend of $1.24 per share and has a dividend yield of 7.3%. Rithm Capital pays an annual dividend of $1.00 per share and has a dividend yield of 9.2%. Healthcare Realty Trust pays out -78.5% of its earnings in the form of a dividend. Rithm Capital pays out 101.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Healthcare Realty Trust and Rithm Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Healthcare Realty Trust	-45.63%	-9.42%	-4.90%
Rithm Capital	14.99%	17.54%	2.50%

Summary

Rithm Capital beats Healthcare Realty Trust on 13 of the 16 factors compared between the two stocks.

About Healthcare Realty Trust

Healthcare Realty (NYSE: HR) is a real estate investment trust (REIT) that owns and operates medical outpatient buildings primarily located around market-leading hospital campuses. The Company selectively grows its portfolio through property acquisition and development. As the first and largest REIT to specialize in medical outpatient buildings, Healthcare Realty's portfolio includes more than 700 properties totaling over 40 million square feet concentrated in 15 growth markets.

About Rithm Capital

Rithm Capital Corp. operates as an asset manager focused on real estate, credit, and financial services. It operates through Origination and Servicing, Investment Portfolio, Mortgage Loans Receivable, and Asset Management segments. Its investment portfolio primarily comprises of mortgage servicing rights (MSR), and MSR financing receivables, title, appraisal and property preservation, excess MSRs, and services advance investments; real estate securities, call rights, SFR properties, and residential mortgage loans; consumer and business purpose loans; and asset management related investments. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was formerly known as New Residential Investment Corp. and changed its name to Rithm Capital Corp. in August 2022. Rithm Capital Corp. was incorporated in 2011 and is based in New York, New York.