National Retail Properties (NYSE: NNN) and CoreSite Realty Corporation (NYSE:COR) are both mid-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their risk, valuation, dividends, analyst recommendations, earnings, profitability and institutional ownership.
Valuation & Earnings
This table compares National Retail Properties and CoreSite Realty Corporation’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|National Retail Properties||$562.72 million||11.20||$500.46 million||$1.33||31.74|
|CoreSite Realty Corporation||$444.59 million||8.76||$232.47 million||$1.74||65.39|
National Retail Properties has higher revenue and earnings than CoreSite Realty Corporation. National Retail Properties is trading at a lower price-to-earnings ratio than CoreSite Realty Corporation, indicating that it is currently the more affordable of the two stocks.
This table compares National Retail Properties and CoreSite Realty Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|National Retail Properties||44.17%||8.22%||4.03%|
|CoreSite Realty Corporation||15.15%||14.14%||4.69%|
This is a summary of current recommendations for National Retail Properties and CoreSite Realty Corporation, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|National Retail Properties||0||2||4||0||2.67|
|CoreSite Realty Corporation||0||7||3||0||2.30|
National Retail Properties presently has a consensus target price of $48.20, suggesting a potential upside of 14.16%. CoreSite Realty Corporation has a consensus target price of $102.38, suggesting a potential downside of 10.02%. Given National Retail Properties’ stronger consensus rating and higher possible upside, research analysts clearly believe National Retail Properties is more favorable than CoreSite Realty Corporation.
Institutional & Insider Ownership
89.4% of National Retail Properties shares are held by institutional investors. Comparatively, 98.3% of CoreSite Realty Corporation shares are held by institutional investors. 1.0% of National Retail Properties shares are held by company insiders. Comparatively, 1.5% of CoreSite Realty Corporation shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
National Retail Properties pays an annual dividend of $1.90 per share and has a dividend yield of 4.5%. CoreSite Realty Corporation pays an annual dividend of $3.60 per share and has a dividend yield of 3.2%. National Retail Properties pays out 142.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CoreSite Realty Corporation pays out 206.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. National Retail Properties has increased its dividend for 6 consecutive years and CoreSite Realty Corporation has increased its dividend for 7 consecutive years. National Retail Properties is clearly the better dividend stock, given its higher yield and lower payout ratio.
Volatility & Risk
National Retail Properties has a beta of 0.37, indicating that its stock price is 63% less volatile than the S&P 500. Comparatively, CoreSite Realty Corporation has a beta of 0.56, indicating that its stock price is 44% less volatile than the S&P 500.
National Retail Properties beats CoreSite Realty Corporation on 9 of the 17 factors compared between the two stocks.
National Retail Properties Company Profile
National Retail Properties, Inc. is a real estate investment trust (REIT). The Company acquires, owns, invests in and develops properties that are leased primarily to retail tenants under long-term net leases and are primarily held for investment. As of December 31, 2016, it owned 2,535 properties with an aggregate gross leasable area of approximately 27,204,000 square feet, located in 48 states. The Company focuses on investing in a range of property and tenant types; leases, mortgages and other types of real estate interests; loans secured by personal property; loans secured by partnership or membership interests in partnerships or limited liability companies, and securities of other REITs, or other issuers, including for the purpose of exercising control over such entities. The Company owns a portfolio of freestanding retail stores across the United States. It owns approximately 2,290 stores, which are leased to over 400 tenants in approximately 40 different retail categories.
CoreSite Realty Corporation Company Profile
CoreSite Realty Corporation (CoreSite) is an integrated, self-administered and self-managed real estate investment trust. The Company, through its controlling interest in CoreSite, L.P., is engaged in the business of ownership, acquisition, construction and operation of data centers across a range of markets in the United States, including the Northern Virginia, New York and San Francisco Bay areas, Chicago, Los Angeles, Boston, Miami and Denver. The enterprises, network operators, cloud providers and supporting service providers choose CoreSite to connect and protect their data, applications and computing workloads. Its offerings include the CoreSite Open Cloud Exchange and the Any2 Internet Exchange. As of December 31, 2016, it had offered cloud-enabled, network data center campuses with over 20,000 interconnections across its portfolio and direct access to carriers and Internet service providers, cloud and information technology service providers, and inter site connectivity.
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