Contrasting Postal Realty Trust (NYSE:PSTL) & JBG SMITH Properties (NYSE:JBGS)

Postal Realty Trust (NYSE:PSTL) and JBG SMITH Properties (NYSE:JBGS) are both small-cap real estate companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, valuation, institutional ownership, earnings, dividends, profitability and analyst recommendations.

Dividends

Postal Realty Trust pays an annual dividend of $0.98 per share and has a dividend yield of 4.3%. JBG SMITH Properties pays an annual dividend of $0.70 per share and has a dividend yield of 5.6%. Postal Realty Trust pays out 171.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. JBG SMITH Properties pays out -19.8% of its earnings in the form of a dividend. Postal Realty Trust has raised its dividend for 3 consecutive years. JBG SMITH Properties is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Postal Realty Trust has a beta of 0.81, meaning that its share price is 19% less volatile than the S&P 500. Comparatively, JBG SMITH Properties has a beta of 1.12, meaning that its share price is 12% more volatile than the S&P 500.

Insider and Institutional Ownership

57.9% of Postal Realty Trust shares are held by institutional investors. Comparatively, 98.5% of JBG SMITH Properties shares are held by institutional investors. 12.5% of Postal Realty Trust shares are held by company insiders. Comparatively, 11.9% of JBG SMITH Properties shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Postal Realty Trust and JBG SMITH Properties”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Postal Realty Trust	$95.82 million	6.63	$14.15 million	$0.57	40.33
JBG SMITH Properties	$498.60 million	1.46	-$139.06 million	($3.54)	-3.50

Postal Realty Trust has higher earnings, but lower revenue than JBG SMITH Properties. JBG SMITH Properties is trading at a lower price-to-earnings ratio than Postal Realty Trust, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Postal Realty Trust and JBG SMITH Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Postal Realty Trust	17.15%	5.00%	2.40%
JBG SMITH Properties	-29.89%	-13.31%	-3.49%

Analyst Recommendations

This is a breakdown of recent ratings for Postal Realty Trust and JBG SMITH Properties, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Postal Realty Trust	0	2	6	0	2.75
JBG SMITH Properties	3	0	0	0	1.00

Postal Realty Trust presently has a consensus target price of $25.38, indicating a potential upside of 10.39%. JBG SMITH Properties has a consensus target price of $12.50, indicating a potential upside of 0.83%. Given Postal Realty Trust’s stronger consensus rating and higher possible upside, research analysts plainly believe Postal Realty Trust is more favorable than JBG SMITH Properties.

Summary

Postal Realty Trust beats JBG SMITH Properties on 11 of the 17 factors compared between the two stocks.

About Postal Realty Trust

Postal Realty Trust, Inc. (NYSE: PSTL) is an internally managed real estate investment trust that owns properties primarily leased to the United States Postal Service ("USPS"). PSTL is focused on acquiring the network of USPS properties, which provide a critical element of the nation's logistics infrastructure that facilitates cost effective and efficient last-mile delivery solutions. As of December 31, 2023, PSTL owned 1,509 properties (including two properties accounted for as financing leases) located in 49 states and one territory comprising approximately 5.9 million net leasable interior square feet. Subsequent to quarter-end and through February 23, 2024, PSTL closed on eight additional properties comprising approximately 33,000 net leasable interior square feet.

About JBG SMITH Properties

JBG SMITH Properties is a real estate investment trust, which engages in owning, operating, investing in, and developing a portfolio of mixed-use properties. It operates through the following segments: Multifamily, Commercial, and Other. The Multifamily segment refers to the commercial buildings with public areas, retail spaces, and walkable streets. The Commercial segment rents to federal government tenants. The Other segment relates to development assets, corporate entities, land assets for which are the ground lessor and the elimination of inter-segment activity. The company was founded on October 27, 2016, and is headquartered in Bethesda, MD.