Reviewing Pennsylvania R.E.I.T. (NYSE:PEI) and MedEquities Realty Trust (NYSE:MRT)

Pennsylvania R.E.I.T. (NYSE:PEI) and MedEquities Realty Trust (NYSE:MRT) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their risk, institutional ownership, analyst recommendations, earnings, dividends, valuation and profitability.

Volatility and Risk

Pennsylvania R.E.I.T. has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500. Comparatively, MedEquities Realty Trust has a beta of 1.64, indicating that its stock price is 64% more volatile than the S&P 500.

Institutional and Insider Ownership

67.9% of Pennsylvania R.E.I.T. shares are owned by institutional investors. Comparatively, 94.5% of MedEquities Realty Trust shares are owned by institutional investors. 3.1% of Pennsylvania R.E.I.T. shares are owned by company insiders. Comparatively, 3.0% of MedEquities Realty Trust shares are owned by company 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.

Dividends

Pennsylvania R.E.I.T. pays an annual dividend of $0.84 per share and has a dividend yield of 18.5%. MedEquities Realty Trust pays an annual dividend of $0.42 per share. Pennsylvania R.E.I.T. pays out 54.5% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Pennsylvania R.E.I.T. and MedEquities Realty Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pennsylvania R.E.I.T. 2 1 1 0 1.75
MedEquities Realty Trust 0 6 0 0 2.00

Pennsylvania R.E.I.T. currently has a consensus price target of $6.67, suggesting a potential upside of 46.52%. MedEquities Realty Trust has a consensus price target of $10.20, suggesting a potential upside of ∞. Given MedEquities Realty Trust’s stronger consensus rating and higher probable upside, analysts clearly believe MedEquities Realty Trust is more favorable than Pennsylvania R.E.I.T..

Profitability

This table compares Pennsylvania R.E.I.T. and MedEquities Realty Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pennsylvania R.E.I.T. -28.45% -18.31% -4.14%
MedEquities Realty Trust 3.24% 1.01% 0.56%

Valuation and Earnings

This table compares Pennsylvania R.E.I.T. and MedEquities Realty Trust’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Pennsylvania R.E.I.T. $362.40 million 0.97 -$110.33 million $1.54 2.95
MedEquities Realty Trust $57.26 million 0.00 $5.66 million N/A N/A

MedEquities Realty Trust has lower revenue, but higher earnings than Pennsylvania R.E.I.T..

Summary

MedEquities Realty Trust beats Pennsylvania R.E.I.T. on 10 of the 14 factors compared between the two stocks.

Pennsylvania R.E.I.T. Company Profile

PREIT (NYSE:PEI) is a publicly traded real estate investment trust that owns and manages quality properties in compelling markets. PREIT's robust portfolio of carefully curated retail and lifestyle offerings mixed with destination dining and entertainment experiences are located primarily in the densely-populated eastern U.S. with concentrations in the mid-Atlantic's top MSAs. Since 2012, the Company has driven a transformation guided by an emphasis on portfolio quality and balance sheet strength driven by disciplined capital expenditures.

MedEquities Realty Trust Company Profile

MedEquities Realty Trust (NYSE: MRT) is a self-managed and self-administered real estate investment trust that invests in a diversified mix of healthcare properties and healthcare-related real estate debt investments. The Company's management team has extensive industry experience in acquiring, owning, developing, financing, operating, leasing and monetizing many types of healthcare properties and portfolios. MedEquities' strategy is to become an integral capital partner with high-quality and growth-oriented facility-based providers of healthcare services on a nationwide basis, primarily through net-leased real estate investment.

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