Head to Head Contrast: Alexander’s (NYSE:ALX) and PS Business Parks (NYSE:PSB)
Alexander’s (NYSE:ALX) and PS Business Parks (NYSE:PSB) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, dividends, profitability, earnings, institutional ownership and valuation.
Alexander’s pays an annual dividend of $18.00 per share and has a dividend yield of 7.4%. PS Business Parks pays an annual dividend of $4.20 per share and has a dividend yield of 3.2%. Alexander’s pays out 92.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. PS Business Parks pays out 61.9% of its earnings in the form of a dividend. Alexander’s has increased its dividend for 9 consecutive years and PS Business Parks has increased its dividend for 6 consecutive years. Alexander’s is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Alexander’s has a beta of 0.57, suggesting that its stock price is 43% less volatile than the S&P 500. Comparatively, PS Business Parks has a beta of 0.45, suggesting that its stock price is 55% less volatile than the S&P 500.
Institutional and Insider Ownership
35.8% of Alexander’s shares are owned by institutional investors. Comparatively, 71.7% of PS Business Parks shares are owned by institutional investors. 26.2% of Alexander’s shares are owned by company insiders. Comparatively, 1.4% of PS Business Parks shares are owned 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 and Earnings
This table compares Alexander’s and PS Business Parks’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Alexander’s||$226.35 million||5.46||$60.08 million||$19.47||12.43|
|PS Business Parks||$429.85 million||8.33||$174.97 million||$6.78||19.22|
PS Business Parks has higher revenue and earnings than Alexander’s. Alexander’s is trading at a lower price-to-earnings ratio than PS Business Parks, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings for Alexander’s and PS Business Parks, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|PS Business Parks||2||1||0||0||1.33|
Alexander’s currently has a consensus target price of $280.00, suggesting a potential upside of 15.70%. PS Business Parks has a consensus target price of $141.00, suggesting a potential upside of 8.23%. Given Alexander’s’ higher probable upside, analysts clearly believe Alexander’s is more favorable than PS Business Parks.
This table compares Alexander’s and PS Business Parks’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|PS Business Parks||44.22%||18.56%||9.15%|
PS Business Parks beats Alexander’s on 10 of the 16 factors compared between the two stocks.
Alexander’s Company Profile
Alexander’s, Inc. is a real estate investment trust, which engages in leasing, managing, development and redeveloping its properties. Its operating properties are located in the greater New York City metropolitan area. The company was founded on May 16, 1955 and is headquartered in Paramus, NJ.
PS Business Parks Company Profile
PS Business Parks, Inc., a member of the S&P SmallCap 600, is a REIT that acquires, develops, owns and operates commercial properties, primarily multi-tenant industrial, flex and office space. As of December 31, 2018, the Company wholly owned 28.2 million rentable square feet with approximately 5,050 commercial customers in six states and held a 95.0% interest in a 395-unit apartment complex.
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