Head-To-Head Analysis: NRF Holdco (NRF) and Realty Income Corporation (O)
NRF Holdco (NYSE: NRF) and Realty Income Corporation (NYSE:O) are both financials companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, dividends, earnings, profitability, analyst recommendations, valuation and risk.
Earnings and Valuation
This table compares NRF Holdco and Realty Income Corporation’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Realty Income Corporation||$1.16 billion||13.50||$1.05 billion||$1.17||48.85|
Realty Income Corporation has higher revenue and earnings than NRF Holdco. NRF Holdco is trading at a lower price-to-earnings ratio than Realty Income Corporation, indicating that it is currently the more affordable of the two stocks.
This is a summary of current ratings and recommmendations for NRF Holdco and Realty Income Corporation, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Realty Income Corporation||2||4||3||0||2.11|
NRF Holdco presently has a consensus price target of $16.00, indicating a potential downside of 0.81%. Realty Income Corporation has a consensus price target of $66.00, indicating a potential upside of 15.49%. Given Realty Income Corporation’s higher probable upside, analysts clearly believe Realty Income Corporation is more favorable than NRF Holdco.
Volatility & Risk
NRF Holdco has a beta of 1.69, indicating that its stock price is 69% more volatile than the S&P 500. Comparatively, Realty Income Corporation has a beta of 0.32, indicating that its stock price is 68% less volatile than the S&P 500.
This table compares NRF Holdco and Realty Income Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Realty Income Corporation||29.19%||5.14%||2.62%|
Institutional & Insider Ownership
69.7% of NRF Holdco shares are owned by institutional investors. Comparatively, 69.0% of Realty Income Corporation shares are owned by institutional investors. 2.4% of NRF Holdco shares are owned by insiders. Comparatively, 0.3% of Realty Income Corporation shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
NRF Holdco pays an annual dividend of $1.60 per share and has a dividend yield of 9.9%. Realty Income Corporation pays an annual dividend of $2.54 per share and has a dividend yield of 4.4%. NRF Holdco pays out -67.2% of its earnings in the form of a dividend. Realty Income Corporation pays out 217.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NRF Holdco has increased its dividend for 21 consecutive years. NRF Holdco is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
About NRF Holdco
NRF Holdco LLC. is a commercial real estate company. The Company invests in multiple asset classes across commercial real estate (CRE). Its portfolio consists of healthcare, hotel, manufactured housing communities, net lease and multifamily properties. The Company also invests in other opportunistic real estate investments, such as indirect interests in real estate through its investments in private equity funds (PE Investments). The Company also acquires and operates hotel and certain healthcare properties. The Company’s segments include Real Estate, Commercial Real Estate Debt (CRE debt), Commercial Real Estate Securities, N-Star CDOs and Corporate. Its real estate equity investments that operate under the REIT Investment Diversification and Empowerment Act (RIDEA) structure generate resident and hotel guest related income from short-term residential agreements. The Company is externally managed and advised by an affiliate of NorthStar Asset Management Group Inc.
About Realty Income Corporation
Realty Income Corporation is a real estate investment trust (REIT). The Company is engaged in in-house acquisition, portfolio management, asset management, credit research, real estate research, legal, finance and accounting, information technology and capital markets capabilities. As of December 31, 2016, the Company owned a diversified portfolio of 4,944 properties located in 49 states and Puerto Rico, with over 83.0 million square feet of leasable space leased to 248 different commercial tenants doing business in 47 separate industries. As of December 31, 2016, of the 4,944 properties in the portfolio, 4,920, or 99.5%, were single-tenant properties, and the remaining were multi-tenant properties. As of December 31, 2016, of the 4,920 single-tenant properties, 4,836 were leased with a weighted average remaining lease term (excluding rights to extend a lease at the option of the tenant) of approximately 9.8 years.
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