Brandywine Realty Trust (NYSE:BDN) and Host Hotels and Resorts (NYSE:HST) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.

Insider & Institutional Ownership

94.7% of Brandywine Realty Trust shares are owned by institutional investors. Comparatively, 97.9% of Host Hotels and Resorts shares are owned by institutional investors. 1.3% of Brandywine Realty Trust shares are owned by company insiders. Comparatively, 1.2% of Host Hotels and Resorts shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility & Risk

Brandywine Realty Trust has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500. Comparatively, Host Hotels and Resorts has a beta of 1.21, indicating that its share price is 21% more volatile than the S&P 500.

Profitability

This table compares Brandywine Realty Trust and Host Hotels and Resorts’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Brandywine Realty Trust 25.04% 7.44% 3.40%
Host Hotels and Resorts 19.68% 14.86% 8.99%

Earnings & Valuation

This table compares Brandywine Realty Trust and Host Hotels and Resorts’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Brandywine Realty Trust $544.34 million 5.00 $136.32 million $1.37 11.31
Host Hotels and Resorts $5.52 billion 2.54 $1.09 billion $1.77 10.69

Host Hotels and Resorts has higher revenue and earnings than Brandywine Realty Trust. Host Hotels and Resorts is trading at a lower price-to-earnings ratio than Brandywine Realty Trust, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Brandywine Realty Trust and Host Hotels and Resorts, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Brandywine Realty Trust 0 4 2 0 2.33
Host Hotels and Resorts 3 2 7 0 2.33

Brandywine Realty Trust currently has a consensus target price of $16.75, indicating a potential upside of 8.13%. Host Hotels and Resorts has a consensus target price of $21.24, indicating a potential upside of 12.27%. Given Host Hotels and Resorts’ higher probable upside, analysts clearly believe Host Hotels and Resorts is more favorable than Brandywine Realty Trust.

Dividends

Brandywine Realty Trust pays an annual dividend of $0.76 per share and has a dividend yield of 4.9%. Host Hotels and Resorts pays an annual dividend of $0.80 per share and has a dividend yield of 4.2%. Brandywine Realty Trust pays out 55.5% of its earnings in the form of a dividend. Host Hotels and Resorts pays out 45.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Brandywine Realty Trust has raised its dividend for 4 consecutive years. Brandywine Realty Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Host Hotels and Resorts beats Brandywine Realty Trust on 10 of the 16 factors compared between the two stocks.

About Brandywine Realty Trust

Brandywine Realty Trust (NYSE: BDN) is one of the largest, publicly traded, full-service, integrated real estate companies in the United States with a core focus in the Philadelphia, Washington, D.C., and Austin markets. Organized as a real estate investment trust (REIT), we own, develop, lease and manage an urban, town center and transit-oriented portfolio comprising 181 properties and 24.8 million square feet as of December 31, 2018, which excludes assets held for sale. Our purpose is to shape, connect and inspire the world around us through our expertise, the relationships we foster, the communities in which we live and work, and the history we build together.

About Host Hotels and Resorts

Host Hotels & Resorts, Inc. is an S&P 500 company and is the largest lodging real estate investment trust and one of the largest owners of luxury and upper-upscale hotels. The Company currently owns 88 properties in the United States and five properties internationally totaling approximately 52,000 rooms. The Company also holds non-controlling interests in six domestic and one international joint ventures. Guided by a disciplined approach to capital allocation and aggressive asset management, the Company partners with premium brands such as Marriott, Ritz-Carlton, Westin, Sheraton, W, St. Regis, The Luxury Collection, Hyatt, Fairmont, Hilton, Swissôtel, ibis and Novotel, as well as independent brands in the operation of properties in over 50 major markets.

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