Critical Analysis: NorthStar Realty Europe Corp. (NRE) & Its Peers
NorthStar Realty Europe Corp. (NYSE: NRE) is one of 20 publicly-traded companies in the “Office REITs” industry, but how does it contrast to its rivals? We will compare NorthStar Realty Europe Corp. to similar businesses based on the strength of its analyst recommendations, dividends, risk, profitability, valuation, institutional ownership and earnings.
NorthStar Realty Europe Corp. pays an annual dividend of $0.60 per share and has a dividend yield of 4.6%. NorthStar Realty Europe Corp. pays out -133.3% of its earnings in the form of a dividend. As a group, “Office REITs” companies pay a dividend yield of 3.3% and pay out 249.2% of their earnings in the form of a dividend. NorthStar Realty Europe Corp. is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.
This table compares NorthStar Realty Europe Corp. and its rivals’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|NorthStar Realty Europe Corp.||-18.57%||7.73%||2.46%|
|NorthStar Realty Europe Corp. Competitors||5.41%||1.37%||0.69%|
Insider and Institutional Ownership
69.9% of NorthStar Realty Europe Corp. shares are owned by institutional investors. Comparatively, 85.4% of shares of all “Office REITs” companies are owned by institutional investors. 2.2% of NorthStar Realty Europe Corp. shares are owned by company insiders. Comparatively, 3.2% of shares of all “Office REITs” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Risk & Volatility
NorthStar Realty Europe Corp. has a beta of 2.49, indicating that its stock price is 149% more volatile than the S&P 500. Comparatively, NorthStar Realty Europe Corp.’s rivals have a beta of 0.90, indicating that their average stock price is 10% less volatile than the S&P 500.
This is a breakdown of current ratings for NorthStar Realty Europe Corp. and its rivals, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|NorthStar Realty Europe Corp.||0||0||1||0||3.00|
|NorthStar Realty Europe Corp. Competitors||114||514||551||3||2.37|
NorthStar Realty Europe Corp. presently has a consensus target price of $16.50, indicating a potential upside of 26.15%. As a group, “Office REITs” companies have a potential upside of 7.11%. Given NorthStar Realty Europe Corp.’s stronger consensus rating and higher probable upside, equities analysts plainly believe NorthStar Realty Europe Corp. is more favorable than its rivals.
Valuation and Earnings
This table compares NorthStar Realty Europe Corp. and its rivals revenue, earnings per share (EPS) and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|NorthStar Realty Europe Corp.||$131.25 million||$37.01 million||-29.07|
|NorthStar Realty Europe Corp. Competitors||$672.08 million||$356.91 million||60.23|
NorthStar Realty Europe Corp.’s rivals have higher revenue and earnings than NorthStar Realty Europe Corp.. NorthStar Realty Europe Corp. is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.
NorthStar Realty Europe Corp. beats its rivals on 8 of the 14 factors compared.
NorthStar Realty Europe Corp. Company Profile
NorthStar Realty Europe Corp. is a real estate investment trust (REIT). The Company is a European focused commercial real estate company with primary office properties in cities within Germany, the United Kingdom and France. Its objective is to provide its stockholders with stable and recurring cash flow supplemented by capital growth over time. The Company conducts its business through two segments: Real Estate and Corporate. Its European commercial real estate business is primarily focused on office properties. Its portfolio consists of approximately 48 properties and a total of approximately 495,588 square meters of rentable space, located in various European markets, including Frankfurt, Hamburg, Berlin, London, Paris, Amsterdam, Milan, Brussels and Madrid. Its overall portfolio is over 87% occupied. In addition, it owns over two hotels, which are leased to third-party operators. It is externally managed and advised by an affiliate of NorthStar Asset Management Group Inc. (NSAM).
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