JBG SMITH Properties (NYSE:JBGS) versus Vornado Realty Trust (NYSE:VNO) Critical Analysis

Vornado Realty Trust (NYSE:VNO) and JBG SMITH Properties (NYSE:JBGS) are both real estate companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, valuation, dividends, institutional ownership and earnings.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Vornado Realty Trust and JBG SMITH Properties, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vornado Realty Trust	4	5	4	0	2.00
JBG SMITH Properties	3	0	0	0	1.00

Vornado Realty Trust currently has a consensus target price of $39.82, indicating a potential upside of 4.29%. JBG SMITH Properties has a consensus target price of $16.67, indicating a potential upside of 37.29%. Given JBG SMITH Properties’ higher possible upside, analysts clearly believe JBG SMITH Properties is more favorable than Vornado Realty Trust.

Profitability

This table compares Vornado Realty Trust and JBG SMITH Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Vornado Realty Trust	3.71%	1.37%	0.43%
JBG SMITH Properties	-29.89%	-13.31%	-3.49%

Dividends

Vornado Realty Trust pays an annual dividend of $0.74 per share and has a dividend yield of 1.9%. JBG SMITH Properties pays an annual dividend of $0.70 per share and has a dividend yield of 5.8%. Vornado Realty Trust pays out 3,700.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. JBG SMITH Properties pays out -26.8% of its earnings in the form of a dividend. JBG SMITH Properties is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

90.0% of Vornado Realty Trust shares are held by institutional investors. Comparatively, 98.5% of JBG SMITH Properties shares are held by institutional investors. 9.0% of Vornado Realty Trust shares are held by company insiders. Comparatively, 11.9% of JBG SMITH Properties shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Vornado Realty Trust and JBG SMITH Properties”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vornado Realty Trust	$1.81 billion	3.94	$904.96 million	$0.02	1,909.00
JBG SMITH Properties	$498.60 million	1.43	-$139.06 million	($2.61)	-4.65

Vornado Realty Trust has higher revenue and earnings than JBG SMITH Properties. JBG SMITH Properties is trading at a lower price-to-earnings ratio than Vornado Realty Trust, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Vornado Realty Trust has a beta of 1.53, meaning that its share price is 53% more volatile than the S&P 500. Comparatively, JBG SMITH Properties has a beta of 1.07, meaning that its share price is 7% more volatile than the S&P 500.

Summary

Vornado Realty Trust beats JBG SMITH Properties on 11 of the 16 factors compared between the two stocks.

About Vornado Realty Trust

Vornado Realty Trust is a fully – integrated equity real estate investment trust.

About JBG SMITH Properties

JBG SMITH Properties is a real estate investment trust, which engages in owning, operating, investing in, and developing a portfolio of mixed-use properties. It operates through the following segments: Multifamily, Commercial, and Other. The Multifamily segment refers to the commercial buildings with public areas, retail spaces, and walkable streets. The Commercial segment rents to federal government tenants. The Other segment relates to development assets, corporate entities, land assets for which are the ground lessor and the elimination of inter-segment activity. The company was founded on October 27, 2016, and is headquartered in Bethesda, MD.