Critical Comparison: Seritage Growth Properties (NYSE:SRG) & Community Healthcare Trust (NYSE:CHCT)

Community Healthcare Trust (NYSE:CHCT) and Seritage Growth Properties (NYSE:SRG) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, valuation, dividends, profitability, earnings, analyst recommendations and risk.

Volatility and 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, Seritage Growth Properties has a beta of 2.43, indicating that its stock price is 143% more volatile than the S&P 500.

Valuation and Earnings

This table compares Community Healthcare Trust and Seritage Growth Properties”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	3.84	$5.10 million	$0.07	232.63
Seritage Growth Properties	$17.62 million	9.00	-$153.54 million	($1.42)	-1.98

Community Healthcare Trust has higher revenue and earnings than Seritage Growth Properties. Seritage Growth Properties 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.

Insider & Institutional Ownership

87.8% of Community Healthcare Trust shares are owned by institutional investors. Comparatively, 78.9% of Seritage Growth Properties shares are owned by institutional investors. 5.1% of Community Healthcare Trust shares are owned by insiders. Comparatively, 0.6% of Seritage Growth Properties shares are owned 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.

Analyst Ratings

This is a breakdown of current recommendations for Community Healthcare Trust and Seritage Growth Properties, 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
Seritage Growth Properties	1	0	0	0	1.00

Community Healthcare Trust presently has a consensus target price of $18.00, indicating a potential upside of 10.54%. Given Community Healthcare Trust’s stronger consensus rating and higher probable upside, analysts plainly believe Community Healthcare Trust is more favorable than Seritage Growth Properties.

Profitability

This table compares Community Healthcare Trust and Seritage Growth Properties’ 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%
Seritage Growth Properties	-404.37%	-20.13%	-12.10%

Summary

Community Healthcare Trust beats Seritage Growth Properties on 12 of the 14 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 Seritage Growth Properties

Seritage Growth Properties operates as a real estate investment trust. The firm engages in the acquisition, ownership, development, redevelopment, management, and leasing of retail properties throughout the United States. Its property portfolio includes mall, shopping centers and freestanding locations. The company was founded on June 3, 2015 and is headquartered in New York, NY.