Alexander’s (NYSE:ALX – Get Free Report) and Innovative Industrial Properties (NYSE:IIPR – Get Free Report) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, dividends, risk, profitability and institutional ownership.
Earnings and Valuation
This table compares Alexander’s and Innovative Industrial Properties”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Alexander’s | $213.18 million | 5.62 | $28.22 million | $5.49 | 42.73 |
| Innovative Industrial Properties | $308.52 million | 4.18 | $161.66 million | $4.22 | 10.90 |
Analyst Ratings
This is a summary of recent recommendations for Alexander’s and Innovative Industrial Properties, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Alexander’s | 0 | 1 | 0 | 1 | 3.00 |
| Innovative Industrial Properties | 3 | 2 | 1 | 0 | 1.67 |
Innovative Industrial Properties has a consensus price target of $68.20, suggesting a potential upside of 48.29%. Given Innovative Industrial Properties’ higher probable upside, analysts plainly believe Innovative Industrial Properties is more favorable than Alexander’s.
Institutional and Insider Ownership
32.0% of Alexander’s shares are owned by institutional investors. Comparatively, 70.6% of Innovative Industrial Properties shares are owned by institutional investors. 26.3% of Alexander’s shares are owned by insiders. Comparatively, 2.0% of Innovative Industrial Properties shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Profitability
This table compares Alexander’s and Innovative Industrial Properties’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Alexander’s | 13.24% | 20.68% | 2.23% |
| Innovative Industrial Properties | 45.80% | 6.77% | 5.40% |
Dividends
Alexander’s pays an annual dividend of $18.00 per share and has a dividend yield of 7.7%. Innovative Industrial Properties pays an annual dividend of $7.60 per share and has a dividend yield of 16.5%. Alexander’s pays out 327.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Innovative Industrial Properties pays out 180.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Alexander’s has raised its dividend for 1 consecutive years and Innovative Industrial Properties has raised its dividend for 4 consecutive years. Innovative Industrial Properties is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Volatility and Risk
Alexander’s has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500. Comparatively, Innovative Industrial Properties has a beta of 1.47, indicating that its share price is 47% more volatile than the S&P 500.
Summary
Innovative Industrial Properties beats Alexander’s on 11 of the 18 factors compared between the two stocks.
About Alexander’s
Alexander’s, Inc. (NYSE: ALX) is a real estate investment trust (REIT), incorporated in Delaware, engaged in leasing, managing, developing and redeveloping its properties. All references to we, us, our, Company and Alexander’s refer to Alexander’s, Inc. and its consolidated subsidiaries. We are managed by, and our properties are leased and developed by, Vornado Realty Trust (Vornado) (NYSE: VNO). We have five properties in New York City.
About Innovative Industrial Properties
Innovative Industrial Properties, Inc. is a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized properties leased to experienced, state-licensed operators for their regulated cannabis facilities. Innovative Industrial Properties, Inc. has elected to be taxed as a real estate investment trust, commencing with the year ended December 31, 2017.
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