Critical Review: Equity Commonwealth (NYSE:EQC) vs. Rithm Property Trust (NYSE:RPT)

Rithm Property Trust (NYSE:RPT) and Equity Commonwealth (NYSE:EQC) are both small-cap companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, earnings, profitability, risk, analyst recommendations and dividends.

Profitability

This table compares Rithm Property Trust and Equity Commonwealth’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rithm Property Trust	5.52%	1.27%	0.31%
Equity Commonwealth	82.00%	2.09%	1.96%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Rithm Property Trust and Equity Commonwealth, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rithm Property Trust	1	0	0	0	1.00
Equity Commonwealth	0	0	0	0	0.00

Earnings & Valuation

This table compares Rithm Property Trust and Equity Commonwealth”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rithm Property Trust	$52.80 million	2.20	$1.47 million	($0.29)	-51.45
Equity Commonwealth	$58.43 million	2.90	$91.16 million	$0.39	4.05

Equity Commonwealth has higher revenue and earnings than Rithm Property Trust. Rithm Property Trust is trading at a lower price-to-earnings ratio than Equity Commonwealth, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

58.6% of Rithm Property Trust shares are owned by institutional investors. Comparatively, 96.0% of Equity Commonwealth shares are owned by institutional investors. 0.3% of Rithm Property Trust shares are owned by company insiders. Comparatively, 2.1% of Equity Commonwealth shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility and Risk

Rithm Property Trust has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500. Comparatively, Equity Commonwealth has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500.

Summary

Equity Commonwealth beats Rithm Property Trust on 10 of the 12 factors compared between the two stocks.

About Rithm Property Trust

Rithm Property Trust Inc is a real estate investment trust (REIT) externally managed by an affiliate of Rithm Capital Corp. (Rithm). The company focuses on commercial real estate-focused investment, including originating, acquiring and managing portfolios of CMBS, commercial real property, commercial mortgage loans and other CRE investments. It has two reportable operating segments: Residential and Commercial. The majority of the company’s revenue is derived from the Residential segment, which is focused on managing a portfolio that includes residential mortgage assets, including whole mortgage loans, RMBS and beneficial interests.

About Equity Commonwealth

Equity Commonwealth (NYSE: EQC) is a Chicago based, internally managed and self-advised real estate investment trust (REIT) with commercial office properties in the United States. EQC's portfolio is comprised of four properties totaling 1.5 million square feet.