Cousins Properties (NYSE: CUZ) and Realty Income (NYSE:O) are both mid-cap financials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, analyst recommendations, dividends and profitability.

Profitability

This table compares Cousins Properties and Realty Income’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cousins Properties 48.08% 8.39% 5.42%
Realty Income 29.37% 5.11% 2.64%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Cousins Properties and Realty Income, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cousins Properties 0 0 4 0 3.00
Realty Income 0 6 3 0 2.33

Cousins Properties currently has a consensus target price of $10.13, indicating a potential upside of 10.90%. Realty Income has a consensus target price of $66.60, indicating a potential upside of 20.63%. Given Realty Income’s higher possible upside, analysts clearly believe Realty Income is more favorable than Cousins Properties.

Dividends

Cousins Properties pays an annual dividend of $0.24 per share and has a dividend yield of 2.6%. Realty Income pays an annual dividend of $2.55 per share and has a dividend yield of 4.6%. Cousins Properties pays out 41.4% of its earnings in the form of a dividend. Realty Income pays out 209.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cousins Properties has raised its dividend for 3 consecutive years and Realty Income has raised its dividend for 22 consecutive years. Realty Income is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Cousins Properties has a beta of 1.24, indicating that its share price is 24% more volatile than the S&P 500. Comparatively, Realty Income has a beta of 0.29, indicating that its share price is 71% less volatile than the S&P 500.

Institutional and Insider Ownership

69.9% of Realty Income shares are held by institutional investors. 1.1% of Cousins Properties shares are held by company insiders. Comparatively, 0.3% of Realty Income 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.

Valuation & Earnings

This table compares Cousins Properties and Realty Income’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cousins Properties $259.21 million 14.79 $79.10 million $0.58 15.74
Realty Income $1.10 billion 14.10 $315.57 million $1.22 45.25

Realty Income has higher revenue and earnings than Cousins Properties. Cousins Properties is trading at a lower price-to-earnings ratio than Realty Income, indicating that it is currently the more affordable of the two stocks.

Summary

Cousins Properties beats Realty Income on 9 of the 17 factors compared between the two stocks.

About Cousins Properties

Cousins Properties Incorporated is a self-administered and self-managed real estate investment trust. The Company’s segments include Office, Mixed-Use, Other, Atlanta, Austin, Charlotte, Orlando, Tampa, Phoenix and Other. It develops, acquires, leases, manages and owns primarily Class A office properties and opportunistic mixed-use developments in Sunbelt markets with a focus on Georgia, Texas and North Carolina. It manages a 15.8 million-square-foot trophy office portfolio in the Sun Belt markets of Atlanta, Austin, Charlotte, Orlando, Tampa and Tempe. As of December 31, 2016, its portfolio of real estate assets consisted of interests in 16.2 million square feet of office space and 786,000 square feet of mixed-use space. The Company, through Cousins TRS Services LLC, owns and manages its own real estate portfolio and performs certain real estate related services for other parties. Its properties include Colorado Tower, 816 Congress, Promenade and Gateway Village.

About Realty Income

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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