DDR Corp. (NYSE: DDR) and Pennsylvania Real Estate Investment Trust (NYSE:PEI) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, institutional ownership, risk, dividends, earnings and profitability.

Earnings & Valuation

This table compares DDR Corp. and Pennsylvania Real Estate Investment Trust’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
DDR Corp. $963.85 million 3.32 $622.40 million ($0.20) -43.60
Pennsylvania Real Estate Investment Trust $392.34 million 1.86 $217.76 million ($1.31) -7.99

DDR Corp. has higher revenue and earnings than Pennsylvania Real Estate Investment Trust. DDR Corp. is trading at a lower price-to-earnings ratio than Pennsylvania Real Estate Investment Trust, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

DDR Corp. has a beta of 0.79, suggesting that its share price is 21% less volatile than the S&P 500. Comparatively, Pennsylvania Real Estate Investment Trust has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500.

Profitability

This table compares DDR Corp. and Pennsylvania Real Estate Investment Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DDR Corp. -5.48% 1.24% 0.42%
Pennsylvania Real Estate Investment Trust -18.13% -9.06% -2.66%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for DDR Corp. and Pennsylvania Real Estate Investment Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DDR Corp. 1 7 4 0 2.25
Pennsylvania Real Estate Investment Trust 1 6 0 0 1.86

DDR Corp. presently has a consensus target price of $12.80, indicating a potential upside of 46.79%. Pennsylvania Real Estate Investment Trust has a consensus target price of $13.92, indicating a potential upside of 32.92%. Given DDR Corp.’s stronger consensus rating and higher probable upside, analysts plainly believe DDR Corp. is more favorable than Pennsylvania Real Estate Investment Trust.

Dividends

DDR Corp. pays an annual dividend of $0.76 per share and has a dividend yield of 8.7%. Pennsylvania Real Estate Investment Trust pays an annual dividend of $0.84 per share and has a dividend yield of 8.0%. DDR Corp. pays out -380.0% of its earnings in the form of a dividend. Pennsylvania Real Estate Investment Trust pays out -64.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. DDR Corp. has raised its dividend for 6 consecutive years and Pennsylvania Real Estate Investment Trust has raised its dividend for 5 consecutive years. DDR Corp. is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

80.0% of DDR Corp. shares are held by institutional investors. Comparatively, 97.7% of Pennsylvania Real Estate Investment Trust shares are held by institutional investors. 16.1% of DDR Corp. shares are held by company insiders. Comparatively, 4.4% of Pennsylvania Real Estate Investment Trust shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

DDR Corp. beats Pennsylvania Real Estate Investment Trust on 15 of the 17 factors compared between the two stocks.

About DDR Corp.

DDR Corp. is a self-administered and self-managed real estate investment trust. It operates through two segments: shopping centers and loan investments. It is in the business of acquiring, owning, developing, redeveloping, expanding, leasing and managing shopping centers. As of December 31, 2016, it owned and managed approximately 106 million total square feet of gross leasable area (GLA). As of December 31, 2016, the portfolio properties included 319 shopping centers (including 152 centers owned through joint ventures). As of December 31, 2016, the portfolio properties also included over 650 acres of undeveloped land, including parcels located adjacent to certain of the shopping centers. As of December 31, 2016, the portfolio properties aggregated to 75.8 million square feet of Company-owned GLA located in 35 states, plus Puerto Rico. These centers are in the Southeast and Midwest, with significant concentrations in Florida, Georgia, Ohio and North Carolina, as well as Puerto Rico.

About Pennsylvania Real Estate Investment Trust

Pennsylvania Real Estate Investment Trust (PREIT) is a self-managed and self-administered real estate investment trust (REIT). The Company’s primary business is owning and operating retail shopping malls, which it does primarily through operating partnership, PREIT Associates, L.P. (PREIT Associates). The Company is engaged in the ownership, management, leasing, acquisition, redevelopment, development and disposition of shopping malls. The Company has a primary investment focus on retail shopping malls located in the eastern half of the United States, primarily in the Mid-Atlantic region. As of December 31, 2016, the Company owned interests in 30 retail properties, of which 26 are operating properties and four are development or redevelopment properties. As of December 31, 2016, the Company’s 26 operating properties included 22 shopping malls and four other retail properties, had a total of 21.7 million square feet and were located in nine states.

Receive News & Stock Ratings for DDR Corp. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for DDR Corp. and related stocks with our FREE daily email newsletter.