Community Healthcare Trust (NYSE:CHCT) vs. Terreno Realty (NYSE:TRNO) Critical Review

Community Healthcare Trust (NYSE:CHCT) and Terreno Realty (NYSE:TRNO) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, dividends, earnings, profitability, analyst recommendations, valuation and risk.

Volatility & Risk

Community Healthcare Trust has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500. Comparatively, Terreno Realty has a beta of 1.12, indicating that its stock price is 12% more volatile than the S&P 500.

Profitability

This table compares Community Healthcare Trust and Terreno Realty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Community Healthcare Trust	4.21%	1.16%	0.52%
Terreno Realty	84.51%	10.08%	7.82%

Institutional & Insider Ownership

87.8% of Community Healthcare Trust shares are owned by institutional investors. 5.3% of Community Healthcare Trust shares are owned by insiders. Comparatively, 2.4% of Terreno Realty shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Dividends

Community Healthcare Trust pays an annual dividend of $1.91 per share and has a dividend yield of 12.3%. Terreno Realty pays an annual dividend of $2.08 per share and has a dividend yield of 3.4%. Community Healthcare Trust pays out 2,728.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Terreno Realty pays out 53.3% of its earnings in the form of a dividend. Community Healthcare Trust has increased its dividend for 3 consecutive years and Terreno Realty has increased its dividend for 5 consecutive years.

Valuation and Earnings

This table compares Community Healthcare Trust and Terreno Realty”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Community Healthcare Trust	$121.19 million	3.66	$5.10 million	$0.07	221.81
Terreno Realty	$476.38 million	13.54	$402.99 million	$3.90	15.56

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

Analyst Recommendations

This is a summary of current ratings and recommmendations for Community Healthcare Trust and Terreno Realty, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Community Healthcare Trust	0	3	1	0	2.25
Terreno Realty	1	2	8	1	2.75

Community Healthcare Trust presently has a consensus price target of $18.00, indicating a potential upside of 15.93%. Terreno Realty has a consensus price target of $69.36, indicating a potential upside of 14.30%. Given Community Healthcare Trust’s higher probable upside, research analysts clearly believe Community Healthcare Trust is more favorable than Terreno Realty.

Summary

Terreno Realty beats Community Healthcare Trust on 13 of the 18 factors compared between the two stocks.

About Community Healthcare Trust

Community Healthcare Trust Incorporated (the Company”, we”, our”) was organized in the State of Maryland on March 28, 2014. The Company is a fully-integrated healthcare real estate company that owns and acquires real estate properties that are leased to hospitals, doctors, healthcare systems or other healthcare service providers. As of March 31, 2024, the Company had investments of approximately $1.1 billion in 197 real estate properties (including a portion of one property accounted for as a sales-type lease with a gross amount totaling approximately $3.0 million and two properties classified as an asset held for sale with an aggregate amount totaling approximately $7.5 million. The properties are located in 35 states, totaling approximately 4.4 million square feet in the aggregate and were approximately 92.3% leased, excluding real estate assets held for sale, at March 31, 2024 with a weighted average remaining lease term of approximately 6.9 years.

About Terreno Realty

Terreno Realty Corporation (Terreno, and together with its subsidiaries, the Company) acquires, owns and operates industrial real estate in six major coastal U.S. markets: Los Angeles, Northern New Jersey/New York City, San Francisco Bay Area, Seattle, Miami, and Washington, D.C. All square feet, acres, occupancy and number of properties disclosed in these notes to the consolidated financial statements are unaudited. As of December 31, 2023, the Company owned 259 buildings aggregating approximately 16.0 million square feet, 45 improved land parcels consisting of approximately 152.4 acres, seven properties under development or redevelopment and approximately 62.7 acres of land entitled for future development. The Company is an internally managed Maryland corporation and elected to be taxed as a real estate investment trust (REIT) under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the Code), commencing with its taxable year ended December 31, 2010.