Comparing Parkway Properties (PKY) and Piedmont Office Realty Trust (PDM)
Parkway Properties (NYSE: PKY) and Piedmont Office Realty Trust (NYSE:PDM) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, valuation, profitability and institutional ownership.
This is a summary of recent ratings and target prices for Parkway Properties and Piedmont Office Realty Trust, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Piedmont Office Realty Trust||0||1||1||0||2.50|
Parkway Properties currently has a consensus target price of $21.60, indicating a potential downside of 6.21%. Piedmont Office Realty Trust has a consensus target price of $22.50, indicating a potential upside of 11.61%. Given Piedmont Office Realty Trust’s stronger consensus rating and higher possible upside, analysts plainly believe Piedmont Office Realty Trust is more favorable than Parkway Properties.
This table compares Parkway Properties and Piedmont Office Realty Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Piedmont Office Realty Trust||9.71%||2.67%||1.29%|
Risk & Volatility
Parkway Properties has a beta of 1.37, indicating that its share price is 37% more volatile than the S&P 500. Comparatively, Piedmont Office Realty Trust has a beta of 0.61, indicating that its share price is 39% less volatile than the S&P 500.
Parkway Properties pays an annual dividend of $0.40 per share and has a dividend yield of 1.7%. Piedmont Office Realty Trust pays an annual dividend of $0.84 per share and has a dividend yield of 4.2%. Piedmont Office Realty Trust pays out 221.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Piedmont Office Realty Trust has increased its dividend for 3 consecutive years. Piedmont Office Realty Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Institutional & Insider Ownership
97.1% of Parkway Properties shares are held by institutional investors. Comparatively, 82.8% of Piedmont Office Realty Trust shares are held by institutional investors. 4.9% of Parkway Properties shares are held by insiders. Comparatively, 0.8% of Piedmont Office Realty Trust shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Earnings and Valuation
This table compares Parkway Properties and Piedmont Office Realty Trust’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Parkway Properties||$182.22 million||6.33||$54.29 million||N/A||N/A|
|Piedmont Office Realty Trust||$579.79 million||5.06||$263.29 million||$0.38||53.05|
Piedmont Office Realty Trust has higher revenue and earnings than Parkway Properties.
Piedmont Office Realty Trust beats Parkway Properties on 9 of the 14 factors compared between the two stocks.
About Parkway Properties
Parkway, Inc. is a self-managed real estate investment trust (REIT). The Company owns and operates office properties located in submarkets in Houston, Texas. As of December 31, 2016, the Company’s portfolio consisted of five Class A assets comprising 19 buildings and totaling approximately 8.7 million rentable square feet in the Greenway, Galleria and Westchase submarkets of Houston. In addition, the Company operates a fee-based real estate service (the Third-Party Services Business) through a subsidiary, Eola Office Partners, LLC and its subsidiaries (collectively, Eola), which in total managed approximately 3.8 million square feet (unaudited) for primarily third-party owners, as of December 31, 2016. The Company’s properties include CityWestPlace, San Felipe Plaza, Phoenix Tower, Greenway Plaza and Post Oak Central.
About Piedmont Office Realty Trust
Piedmont Office Realty Trust, Inc. is an integrated self-managed real estate investment trust (REIT). The Company’s business consists primarily of owning, managing, operating, leasing, acquiring, developing, investing in, and disposing of office real estate assets. As of December 31, 2016, the Company owned and operated 65 in-service office properties, one redevelopment asset, two development assets and one office building through an unconsolidated joint venture. Its properties are located in areas, including New York, Chicago, Atlanta, Dallas, Boston, Minneapolis and Orlando. Its tenant base includes industries, such as business services, depository institutions, educational services, real estate, legal services and insurance carriers. The Company conducts business primarily through Piedmont Operating Partnership, L.P. (Piedmont OP). It performs the management of its buildings through its subsidiaries, including Piedmont Government Services, LLC and Piedmont Office Management, LLC.
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