Financial Survey: Regency Centers (REG) vs. Ramco-Gershenson Properties Trust (RPT)

Regency Centers (NYSE: REG) and Ramco-Gershenson Properties Trust (NYSE:RPT) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, risk, analyst recommendations, earnings and institutional ownership.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Regency Centers and Ramco-Gershenson Properties Trust, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Regency Centers 0 6 3 1 2.50
Ramco-Gershenson Properties Trust 1 6 4 0 2.27

Regency Centers currently has a consensus target price of $70.17, indicating a potential upside of 3.83%. Ramco-Gershenson Properties Trust has a consensus target price of $14.94, indicating a potential upside of 3.09%. Given Regency Centers’ stronger consensus rating and higher probable upside, analysts plainly believe Regency Centers is more favorable than Ramco-Gershenson Properties Trust.

Valuation and Earnings

This table compares Regency Centers and Ramco-Gershenson Properties Trust’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Regency Centers $614.37 million 18.71 $164.92 million $0.90 75.09
Ramco-Gershenson Properties Trust $260.93 million 4.41 $59.66 million $0.59 24.56

Regency Centers has higher revenue and earnings than Ramco-Gershenson Properties Trust. Ramco-Gershenson Properties Trust is trading at a lower price-to-earnings ratio than Regency Centers, indicating that it is currently the more affordable of the two stocks.

Dividends

Regency Centers pays an annual dividend of $2.12 per share and has a dividend yield of 3.1%. Ramco-Gershenson Properties Trust pays an annual dividend of $0.88 per share and has a dividend yield of 6.1%. Regency Centers pays out 235.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ramco-Gershenson Properties Trust pays out 149.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Regency Centers has increased its dividend for 4 consecutive years and Ramco-Gershenson Properties Trust has increased its dividend for 3 consecutive years. Ramco-Gershenson Properties Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Regency Centers and Ramco-Gershenson Properties Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Regency Centers 17.59% 2.82% 1.65%
Ramco-Gershenson Properties Trust 20.75% 6.96% 2.55%

Volatility and Risk

Regency Centers has a beta of 0.58, meaning that its stock price is 42% less volatile than the S&P 500. Comparatively, Ramco-Gershenson Properties Trust has a beta of 0.81, meaning that its stock price is 19% less volatile than the S&P 500.

Institutional and Insider Ownership

92.5% of Regency Centers shares are held by institutional investors. Comparatively, 98.5% of Ramco-Gershenson Properties Trust shares are held by institutional investors. 12.7% of Regency Centers shares are held by company insiders. Comparatively, 3.7% of Ramco-Gershenson Properties Trust shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Regency Centers beats Ramco-Gershenson Properties Trust on 10 of the 18 factors compared between the two stocks.

Regency Centers Company Profile

Regency Centers Corporation is a real estate investment trust (REIT). The Company is the general partner of Regency Centers, L.P. (the Operating Partnership). The Company is engaged in the ownership, management, leasing, acquisition and development of retail shopping centers through the Operating Partnership. The Company’s properties include Palm Valley Marketplace, Shops at Arizona, Amerige Heights Town Center, Clayton Valley Shopping Center, Five Points Shopping Center, French Valley Village Center, Hasley Canyon Village, Pleasant Hill Shopping Center, Snell & Branham Plaza, Applewood Shopping Center, Kent Place, Black Rock, Spring Valley Shopping Center and Pebblebrook Plaza. As of December 31, 2016, the Company owned all of the Preferred Units of the Operating Partnership and approximately 99.9% of the Units in the Operating Partnership. As of December 31, 2016, it owned direct or partial interests in 307 shopping centers.

Ramco-Gershenson Properties Trust Company Profile

Ramco-Gershenson Properties Trust is an equity real estate investment trust. The Company’s primary business is the ownership, management, redevelopment, development and operation of retail shopping centers. As of December 31, 2016, it owned and managed multi-anchored shopping centers in 12 metropolitan markets in the United States. It conducts its business through its operating partnership, Ramco-Gershenson Properties, L.P. It invests in large, multi-anchored shopping centers that include national chain store tenants and supermarket tenants. National chain anchor tenants in its centers include, among others, Bed Bath and Beyond, Dick’s Sporting Goods, and Home Depot. Supermarket anchor tenants in its centers include, among others, Publix Super Market, Whole Foods, Kroger and Sprouts. Its shopping centers are located in metropolitan markets, such as Metro Detroit, Southeast Florida, Greater Denver, Cincinnati, St. Louis, Jacksonville, Tampa/Lakeland, Milwaukee, Chicago and Atlanta.

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