Analyzing American Assets Trust (NYSE:AAT) & Urban Edge Properties (NYSE:UE)

Urban Edge Properties (NYSE:UE) and American Assets Trust (NYSE:AAT) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, valuation, institutional ownership, analyst recommendations, earnings, risk and profitability.

Profitability

This table compares Urban Edge Properties and American Assets Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Urban Edge Properties	23.73%	8.10%	3.35%
American Assets Trust	13.98%	5.43%	2.03%

Dividends

Urban Edge Properties pays an annual dividend of $0.76 per share and has a dividend yield of 3.9%. American Assets Trust pays an annual dividend of $1.36 per share and has a dividend yield of 7.1%. Urban Edge Properties pays out 85.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. American Assets Trust pays out 134.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Urban Edge Properties has raised its dividend for 2 consecutive years and American Assets Trust has raised its dividend for 4 consecutive years. American Assets Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares Urban Edge Properties and American Assets Trust”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Urban Edge Properties	$444.97 million	5.49	$72.56 million	$0.89	21.83
American Assets Trust	$457.86 million	2.55	$72.82 million	$1.01	18.91

American Assets Trust has higher revenue and earnings than Urban Edge Properties. American Assets Trust is trading at a lower price-to-earnings ratio than Urban Edge Properties, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Urban Edge Properties has a beta of 1.04, suggesting that its stock price is 4% more volatile than the S&P 500. Comparatively, American Assets Trust has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500.

Insider and Institutional Ownership

94.9% of Urban Edge Properties shares are held by institutional investors. Comparatively, 90.4% of American Assets Trust shares are held by institutional investors. 2.4% of Urban Edge Properties shares are held by insiders. Comparatively, 36.8% of American Assets Trust shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Urban Edge Properties and American Assets Trust, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Urban Edge Properties	0	5	1	0	2.17
American Assets Trust	0	3	0	0	2.00

Urban Edge Properties presently has a consensus price target of $22.00, suggesting a potential upside of 13.26%. American Assets Trust has a consensus price target of $20.50, suggesting a potential upside of 7.32%. Given Urban Edge Properties’ stronger consensus rating and higher possible upside, analysts clearly believe Urban Edge Properties is more favorable than American Assets Trust.

Summary

Urban Edge Properties beats American Assets Trust on 11 of the 17 factors compared between the two stocks.

About Urban Edge Properties

Urban Edge Properties is a NYSE listed real estate investment trust focused on owning, managing, acquiring, developing, and redeveloping retail real estate in urban communities, primarily in the Washington, D.C. to Boston corridor. Urban Edge owns 76 properties totaling 17.1 million square feet of gross leasable area.

About American Assets Trust

American Assets Trust, Inc. is a full service, vertically integrated and self-administered real estate investment trust ("REIT"), headquartered in San Diego, California. The company has over 55 years of experience in acquiring, improving, developing and managing premier office, retail, and residential properties throughout the United States in some of the nation's most dynamic, high-barrier-to-entry markets primarily in Southern California, Northern California, Washington, Oregon, Texas and Hawaii. The company's office portfolio comprises approximately 4.1 million rentable square feet, and its retail portfolio comprises approximately 3.1 million rentable square feet. In addition, the company owns one mixed-use property (including approximately 94,000 rentable square feet of retail space and a 369-room all-suite hotel) and 2,110 multifamily units. In 2011, the company was formed to succeed to the real estate business of American Assets, Inc., a privately held corporation founded in 1967 and, as such, has significant experience, long-standing relationships and extensive knowledge of its core markets, submarkets and asset classes.