First Industrial Realty Trust (FR) & Gramercy Property Trust (GPT) Financial Analysis
First Industrial Realty Trust (NYSE: FR) and Gramercy Property Trust (NYSE:GPT) are both mid-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, analyst recommendations, dividends, earnings and institutional ownership.
Institutional and Insider Ownership
93.6% of First Industrial Realty Trust shares are held by institutional investors. Comparatively, 88.6% of Gramercy Property Trust shares are held by institutional investors. 1.7% of First Industrial Realty Trust shares are held by company insiders. Comparatively, 1.0% of Gramercy Property Trust shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Risk and Volatility
First Industrial Realty Trust has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500. Comparatively, Gramercy Property Trust has a beta of 0.57, indicating that its share price is 43% less volatile than the S&P 500.
First Industrial Realty Trust pays an annual dividend of $0.84 per share and has a dividend yield of 2.6%. Gramercy Property Trust pays an annual dividend of $1.50 per share and has a dividend yield of 5.1%. First Industrial Realty Trust pays out 78.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Gramercy Property Trust pays out 340.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. First Industrial Realty Trust has raised its dividend for 2 consecutive years and Gramercy Property Trust has raised its dividend for 3 consecutive years. Gramercy Property Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares First Industrial Realty Trust and Gramercy Property Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|First Industrial Realty Trust||32.44%||9.54%||4.47%|
|Gramercy Property Trust||14.10%||2.60%||1.25%|
This is a breakdown of recent recommendations and price targets for First Industrial Realty Trust and Gramercy Property Trust, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|First Industrial Realty Trust||0||4||3||0||2.43|
|Gramercy Property Trust||1||2||3||0||2.33|
First Industrial Realty Trust presently has a consensus target price of $32.00, suggesting a potential downside of 1.84%. Gramercy Property Trust has a consensus target price of $31.25, suggesting a potential upside of 7.09%. Given Gramercy Property Trust’s higher possible upside, analysts plainly believe Gramercy Property Trust is more favorable than First Industrial Realty Trust.
Earnings and Valuation
This table compares First Industrial Realty Trust and Gramercy Property Trust’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|First Industrial Realty Trust||$378.02 million||10.34||$121.23 million||$1.07||30.47|
|Gramercy Property Trust||$517.26 million||9.06||$33.35 million||$0.44||66.32|
First Industrial Realty Trust has higher revenue, but lower earnings than Gramercy Property Trust. First Industrial Realty Trust is trading at a lower price-to-earnings ratio than Gramercy Property Trust, indicating that it is currently the more affordable of the two stocks.
First Industrial Realty Trust beats Gramercy Property Trust on 12 of the 16 factors compared between the two stocks.
About First Industrial Realty Trust
First Industrial Realty Trust, Inc. is a real estate investment trust (REIT). The Trust is a self-administered real estate company, which owns, manages, acquires, sells, develops and redevelops industrial real estate. As of December 31, 2016, the Company’s in-service portfolio consisted of 215 light industrial properties, 53 research and development (R&D)/flex properties, 167 bulk warehouse properties and 100 regional warehouse properties containing an aggregate of approximately 62.2 million square feet of gross leasable area (GLA) located in 23 states. The Company’s in-service portfolio includes all properties that have reached stabilized occupancy, developed and redeveloped properties and acquired properties that are occupied at acquisition or one year from the acquisition date. The Company’s operations are conducted primarily through the First Industrial, L.P. (the Operating Partnership), of which the Company is the sole general partner.
About Gramercy Property Trust
Gramercy Property Trust is a real estate investment trust (REIT), which is an investor and asset manager of commercial real estate. The Company’s operating segments include Investments/Corporate and Asset Management. The Investments/Corporate segment includes all of its activities related to the investment and ownership of commercial properties located throughout the United States and Europe. The Asset Management segment includes substantially all of its activities related to asset and property management of commercial properties located throughout the United States and Europe. It is engaged in acquiring and managing single-tenant, net leased industrial, office and specialty properties. It focuses on income producing properties leased to tenants in markets in the United States and Europe. It earns revenues through rental revenues on properties that it owns in the United States and asset management revenues on properties owned by third parties in the United States and Europe.
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