Critical Analysis: Stratus Properties (NASDAQ:STRS) vs. Cushman & Wakefield (NYSE:CWK)

Stratus Properties (NASDAQ:STRS) and Cushman & Wakefield (NYSE:CWK) are both real estate companies, but which is the better business? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, earnings, dividends, profitability and analyst recommendations.

Insider & Institutional Ownership

61.6% of Stratus Properties shares are held by institutional investors. Comparatively, 95.6% of Cushman & Wakefield shares are held by institutional investors. 10.0% of Stratus Properties shares are held by company insiders. Comparatively, 0.7% of Cushman & Wakefield shares are held by company 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 Stratus Properties and Cushman & Wakefield’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stratus Properties	74.96%	6.28%	3.83%
Cushman & Wakefield	0.63%	16.60%	4.35%

Risk & Volatility

Stratus Properties has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500. Comparatively, Cushman & Wakefield has a beta of 1.53, meaning that its share price is 53% more volatile than the S&P 500.

Earnings & Valuation

This table compares Stratus Properties and Cushman & Wakefield”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stratus Properties	$28.66 million	4.75	$11.98 million	$2.64	6.44
Cushman & Wakefield	$10.29 billion	0.33	$88.20 million	$0.29	50.34

Cushman & Wakefield has higher revenue and earnings than Stratus Properties. Stratus Properties is trading at a lower price-to-earnings ratio than Cushman & Wakefield, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and recommmendations for Stratus Properties and Cushman & Wakefield, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stratus Properties	1	0	0	0	1.00
Cushman & Wakefield	1	3	5	0	2.44

Cushman & Wakefield has a consensus target price of $16.57, suggesting a potential upside of 13.50%. Given Cushman & Wakefield’s stronger consensus rating and higher probable upside, analysts plainly believe Cushman & Wakefield is more favorable than Stratus Properties.

Summary

Cushman & Wakefield beats Stratus Properties on 10 of the 14 factors compared between the two stocks.

About Stratus Properties

Stratus Properties Inc., a real estate company, engages in the entitlement, development, management, leasing, and sale of multi and single family residential and commercial real estate properties in the Austin, Texas area and other select markets in Texas. The company operates in two segments, Real Estate Operations and Leasing Operations. Its leasing operations cover lease of space at retail and mixed-use and multi-family properties. The company was incorporated in 1992 and is headquartered in Austin, Texas.

About Cushman & Wakefield

Cushman & Wakefield Plc engages in the provision of commercial real estate services. It operates through the following geographical segments: Americas, Europe, Middle East and Africa (EMEA), and Asia Pacific (APAC). The Americas segment consists of operations located in the United States, Canada and key markets in Latin America. The EMEA segment includes operations in the UK, France, Netherlands and other markets in Europe and the Middle East. The APAC segment comprises of operations in Australia, Singapore, China and other markets in the Asia Pacific region. The company was founded in 1917 and is headquartered in London, the United Kingdom.