Contrasting PS Business Parks (PSB) and Columbia Property Trust (CXP)
PS Business Parks (NYSE: PSB) and Columbia Property Trust (NYSE:CXP) are both mid-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, risk, valuation, institutional ownership, profitability and dividends.
This is a summary of recent ratings for PS Business Parks and Columbia Property Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|PS Business Parks||1||1||0||0||1.50|
|Columbia Property Trust||0||3||4||0||2.57|
PS Business Parks presently has a consensus price target of $107.00, indicating a potential downside of 21.89%. Columbia Property Trust has a consensus price target of $23.80, indicating a potential upside of 13.12%. Given Columbia Property Trust’s stronger consensus rating and higher probable upside, analysts clearly believe Columbia Property Trust is more favorable than PS Business Parks.
Risk & Volatility
PS Business Parks has a beta of 0.6, indicating that its share price is 40% less volatile than the S&P 500. Comparatively, Columbia Property Trust has a beta of 1.16, indicating that its share price is 16% more volatile than the S&P 500.
This table compares PS Business Parks and Columbia Property Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|PS Business Parks||39.05%||16.50%||7.61%|
|Columbia Property Trust||37.27%||5.55%||3.30%|
Valuation & Earnings
This table compares PS Business Parks and Columbia Property Trust’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|PS Business Parks||$394.93 million||9.44||$261.16 million||$3.06||44.76|
|Columbia Property Trust||$376.05 million||6.78||$171.48 million||$1.14||18.46|
PS Business Parks has higher revenue and earnings than Columbia Property Trust. Columbia Property Trust is trading at a lower price-to-earnings ratio than PS Business Parks, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
72.4% of PS Business Parks shares are owned by institutional investors. Comparatively, 64.8% of Columbia Property Trust shares are owned by institutional investors. 1.6% of PS Business Parks shares are owned by insiders. Comparatively, 0.5% of Columbia Property Trust shares are owned by 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.
PS Business Parks pays an annual dividend of $3.40 per share and has a dividend yield of 2.5%. Columbia Property Trust pays an annual dividend of $0.80 per share and has a dividend yield of 3.8%. PS Business Parks pays out 111.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Columbia Property Trust pays out 70.2% of its earnings in the form of a dividend. PS Business Parks has raised its dividend for 3 consecutive years. Columbia Property Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.
PS Business Parks beats Columbia Property Trust on 11 of the 17 factors compared between the two stocks.
PS Business Parks Company Profile
PS Business Parks, Inc. is a self-advised and self-managed real estate investment trust (REIT). The Company owns, operates and develops commercial properties, primarily multi-tenant flex, office and industrial parks. It focuses on owning concentrated business parks. PS Business Parks, L.P. (the Operating Partnership) is a California limited partnership, which owns directly or indirectly substantially all of its assets and through, which the Company conducts substantially all of its business. PSB is the partner of the Operating Partnership and, as of December 31, 2016, owned 77.9% of the common partnership units. The remaining common partnership units are owned by Public Storage (PS). As of December 31, 2016, the Company owned and operated 28.1 million rentable square feet of commercial space, comprising 99 business parks, in the states, including California, Texas, Virginia, Florida, Maryland and Washington. It also manages 684,000 rentable square feet on behalf of PS.
Columbia Property Trust Company Profile
Columbia Property Trust, Inc. operates as a real estate investment trust (REIT), which owns and operates commercial real estate properties. The Company’s primary objective is to generate long-term shareholder returns from a combination of steadily growing cash flows and appreciation in its net asset values, through the acquisition and ownership of office buildings located principally in high-barrier-to-entry markets. The Company’s segments include New York, San Francisco, Atlanta, Washington, D.C., Boston, Los Angeles and all other office markets. The all other office markets segment consists of properties in similar, low-barrier to entry geographic locations, in which the Company does not plan to make further investments. The Company conducts its business primarily through Columbia Property Trust Operating Partnership, L.P. (Columbia Property Trust OP), which acquires, develops, owns, leases and operates real properties directly through subsidiaries or through joint ventures.
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