Financial Analysis: Douglas Emmett (NYSE:DEI) & NETSTREIT (NYSE:NTST)

NETSTREIT (NYSE:NTST) and Douglas Emmett (NYSE:DEI) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, risk, earnings, profitability, valuation and dividends.

Volatility and Risk

NETSTREIT has a beta of 0.86, meaning that its share price is 14% less volatile than the S&P 500. Comparatively, Douglas Emmett has a beta of 1.12, meaning that its share price is 12% more volatile than the S&P 500.

Insider & Institutional Ownership

97.4% of Douglas Emmett shares are owned by institutional investors. 0.6% of NETSTREIT shares are owned by insiders. Comparatively, 15.1% of Douglas Emmett shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

NETSTREIT pays an annual dividend of $0.86 per share and has a dividend yield of 4.1%. Douglas Emmett pays an annual dividend of $0.76 per share and has a dividend yield of 7.3%. NETSTREIT pays out 955.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Douglas Emmett pays out 844.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NETSTREIT has increased its dividend for 1 consecutive years. Douglas Emmett is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for NETSTREIT and Douglas Emmett, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NETSTREIT	0	2	10	1	2.92
Douglas Emmett	1	8	1	0	2.00

NETSTREIT presently has a consensus price target of $20.83, suggesting a potential downside of 1.82%. Douglas Emmett has a consensus price target of $13.28, suggesting a potential upside of 28.16%. Given Douglas Emmett’s higher probable upside, analysts clearly believe Douglas Emmett is more favorable than NETSTREIT.

Profitability

This table compares NETSTREIT and Douglas Emmett’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NETSTREIT	3.54%	0.51%	0.29%
Douglas Emmett	1.62%	0.46%	0.17%

Valuation & Earnings

This table compares NETSTREIT and Douglas Emmett”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NETSTREIT	$195.01 million	10.56	$6.90 million	$0.09	235.78
Douglas Emmett	$1.00 billion	1.73	$16.27 million	$0.09	115.11

Douglas Emmett has higher revenue and earnings than NETSTREIT. Douglas Emmett is trading at a lower price-to-earnings ratio than NETSTREIT, indicating that it is currently the more affordable of the two stocks.

Summary

NETSTREIT beats Douglas Emmett on 9 of the 17 factors compared between the two stocks.

About NETSTREIT

NETSTREIT Corp. is an internally managed real estate investment trust (REIT) based in Dallas, Texas that specializes in acquiring single-tenant net lease retail properties nationwide. The growing portfolio consists of high-quality properties leased to e-commerce resistant tenants with healthy balance sheets. Led by a management team of seasoned commercial real estate executives, NETSTREIT’s strategy is to create the highest quality net lease retail portfolio in the country with the goal of generating consistent cash flows and dividends for its investors.

About Douglas Emmett

Douglas Emmett, Inc. (DEI) is a fully integrated, self-administered and self-managed real estate investment trust (REIT), and one of the largest owners and operators of high-quality office and multifamily properties located in the premier coastal submarkets of Los Angeles and Honolulu. Douglas Emmett focuses on owning and acquiring a substantial share of top-tier office properties and premier multifamily communities in neighborhoods that possess significant supply constraints, high-end executive housing and key lifestyle amenities.