Vornado Realty Trust (NYSE:VNO) versus Prologis (NYSE:PLD) Critical Analysis

Vornado Realty Trust (NYSE:VNO) and Prologis (NYSE:PLD) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, valuation, analyst recommendations, institutional ownership, profitability, risk and earnings.

Dividends

Vornado Realty Trust pays an annual dividend of $0.74 per share and has a dividend yield of 2.2%. Prologis pays an annual dividend of $4.04 per share and has a dividend yield of 3.0%. Vornado Realty Trust pays out 17.6% of its earnings in the form of a dividend. Prologis pays out 117.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Prologis has raised its dividend for 12 consecutive years. Prologis is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

90.0% of Vornado Realty Trust shares are held by institutional investors. Comparatively, 93.5% of Prologis shares are held by institutional investors. 8.4% of Vornado Realty Trust shares are held by insiders. Comparatively, 0.6% of Prologis shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and target prices for Vornado Realty Trust and Prologis, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vornado Realty Trust	2	9	3	0	2.07
Prologis	0	7	11	1	2.68

Vornado Realty Trust currently has a consensus price target of $38.31, indicating a potential upside of 13.74%. Prologis has a consensus price target of $132.31, indicating a potential downside of 0.67%. Given Vornado Realty Trust’s higher possible upside, analysts plainly believe Vornado Realty Trust is more favorable than Prologis.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Vornado Realty Trust	49.91%	19.48%	5.75%
Prologis	36.71%	5.55%	3.31%

Volatility and Risk

Vornado Realty Trust has a beta of 1.49, meaning that its share price is 49% more volatile than the S&P 500. Comparatively, Prologis has a beta of 1.4, meaning that its share price is 40% more volatile than the S&P 500.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vornado Realty Trust	$1.79 billion	3.62	$70.39 million	$4.20	8.02
Prologis	$8.74 billion	14.16	$3.73 billion	$3.43	38.84

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

Summary

Prologis beats Vornado Realty Trust on 10 of the 18 factors compared between the two stocks.

About Vornado Realty Trust

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

About Prologis

Prologis, Inc. is the global leader in logistics real estate with a focus on high-barrier, high-growth markets. At March 31, 2024, the company owned or had investments in, on a wholly owned basis or through co-investment ventures, properties and development projects expected to total approximately 1.2 billion square feet (115 million square meters) in 19 countries. Prologis leases modern logistics facilities to a diverse base of approximately 6,700 customers principally across two major categories: business-to-business and retail/online fulfillment.