Washington Real Estate Investment Trust (NYSE: WRE) and Liberty Property Trust (NYSE:LPT) are both mid-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, analyst recommendations, risk, dividends and valuation.

Dividends

Washington Real Estate Investment Trust pays an annual dividend of $1.20 per share and has a dividend yield of 4.2%. Liberty Property Trust pays an annual dividend of $1.60 per share and has a dividend yield of 3.9%. Washington Real Estate Investment Trust pays out 400.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Liberty Property Trust pays out 67.5% of its earnings in the form of a dividend. Washington Real Estate Investment Trust has raised its dividend for 3 consecutive years. Washington Real Estate Investment Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Washington Real Estate Investment Trust and Liberty Property Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Washington Real Estate Investment Trust 7.10% 2.10% 0.98%
Liberty Property Trust 47.78% 11.41% 5.69%

Valuation & Earnings

This table compares Washington Real Estate Investment Trust and Liberty Property Trust’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Washington Real Estate Investment Trust $313.26 million 7.22 $119.33 million $0.30 96.13
Liberty Property Trust $746.71 million 8.08 $356.81 million $2.37 17.27

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

Risk & Volatility

Washington Real Estate Investment Trust has a beta of 0.94, indicating that its share price is 6% less volatile than the S&P 500. Comparatively, Liberty Property Trust has a beta of 0.89, indicating that its share price is 11% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Washington Real Estate Investment Trust and Liberty Property Trust, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Washington Real Estate Investment Trust 1 1 2 0 2.25
Liberty Property Trust 1 5 2 0 2.13

Washington Real Estate Investment Trust presently has a consensus price target of $31.00, suggesting a potential upside of 7.49%. Liberty Property Trust has a consensus price target of $42.67, suggesting a potential upside of 4.24%. Given Washington Real Estate Investment Trust’s stronger consensus rating and higher possible upside, research analysts plainly believe Washington Real Estate Investment Trust is more favorable than Liberty Property Trust.

Institutional & Insider Ownership

85.5% of Washington Real Estate Investment Trust shares are held by institutional investors. Comparatively, 91.4% of Liberty Property Trust shares are held by institutional investors. 0.6% of Washington Real Estate Investment Trust shares are held by company insiders. Comparatively, 1.5% of Liberty Property Trust shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Liberty Property Trust beats Washington Real Estate Investment Trust on 10 of the 16 factors compared between the two stocks.

Washington Real Estate Investment Trust Company Profile

Washington Real Estate Investment Trust is a self-administered equity real estate investment trust. The Company’s business consists of the ownership and operation of real property in the greater Washington metro region. The Company owns a diversified portfolio of office buildings, multifamily buildings and retail centers. The Company’s segments include office, multifamily and retail. The Company’s office properties provide office space for various types of businesses and professions. The Company’s multifamily properties provide rental housing for individuals and families throughout the Washington metro region. Its retail properties are typically grocery store anchored neighborhood centers that include other small shop tenants or regional power centers with various junior box tenants. As of April 4, 2017, it owned a diversified portfolio of 50 properties, totaling approximately 6.0 million square feet of commercial space and 4,480 residential units, and land held for development.

Liberty Property Trust Company Profile

Liberty Property Trust (the Trust) is a self-administered and self-managed Maryland real estate investment trust (REIT). The Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership (the Operating Partnership). The Company’s segments include Carolinas/Richmond; Chicago/Milwaukee; Florida; Houston; Lehigh/Central PA; Minnesota; Philadelphia; Southeastern PA; United Kingdom, and Other, which includes Arizona; Atlanta; Cincinnati/Columbus/Indianapolis; Dallas; DC Metro; New Jersey; Southern California, and other. The Company owns and operates industrial properties nationally and owns and operates office properties in a focused group of office markets. Additionally, the Company owns certain assets in the United Kingdom. As of December 31, 2016, the Company owned and operated 450 industrial and 55 office properties totaling 86.0 million square feet.

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