Head-To-Head Analysis: Highwoods Properties (NYSE:HIW) vs. Its Competitors

Highwoods Properties (NYSE: HIW) is one of 20 public companies in the “Office REITs” industry, but how does it compare to its peers? We will compare Highwoods Properties to similar companies based on the strength of its institutional ownership, profitability, valuation, dividends, analyst recommendations, earnings and risk.

Dividends

Highwoods Properties pays an annual dividend of $1.76 per share and has a dividend yield of 3.4%. Highwoods Properties pays out 141.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Office REITs” companies pay a dividend yield of 3.4% and pay out 224.7% of their earnings in the form of a dividend. Highwoods Properties is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Profitability

This table compares Highwoods Properties and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Highwoods Properties 33.05% 10.55% 5.24%
Highwoods Properties Competitors 6.50% 1.59% 0.87%

Volatility & Risk

Highwoods Properties has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500. Comparatively, Highwoods Properties’ peers have a beta of 0.93, meaning that their average stock price is 7% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings for Highwoods Properties and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Highwoods Properties 0 3 3 0 2.50
Highwoods Properties Competitors 116 507 525 3 2.36

Highwoods Properties presently has a consensus target price of $54.80, indicating a potential upside of 6.22%. As a group, “Office REITs” companies have a potential upside of 13.00%. Given Highwoods Properties’ peers higher possible upside, analysts plainly believe Highwoods Properties has less favorable growth aspects than its peers.

Institutional and Insider Ownership

97.5% of Highwoods Properties shares are held by institutional investors. Comparatively, 85.2% of shares of all “Office REITs” companies are held by institutional investors. 1.9% of Highwoods Properties shares are held by insiders. Comparatively, 2.9% of shares of all “Office REITs” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Highwoods Properties and its peers revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Highwoods Properties $683.61 million $366.80 million 41.60
Highwoods Properties Competitors $655.81 million $342.10 million 28.46

Highwoods Properties has higher revenue and earnings than its peers. Highwoods Properties is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

Highwoods Properties beats its peers on 11 of the 15 factors compared.

Highwoods Properties Company Profile

Highwoods Properties, Inc. is an office real estate investment trust (REIT). The Company’s primary business is the operation, acquisition and development of office properties. The Company’s segments include Office and Other. The Company owns, develops, acquires, leases and manages properties primarily in the best business districts (BBDs) of Atlanta, Greensboro, Memphis, Nashville, Orlando, Pittsburgh, Raleigh, Richmond and Tampa. The Company conducts its activities through Highwoods Realty Limited Partnership (the Operating Partnership). The Company offers a range of real estate services to its customers. The Company offers services, including asset management, construction management, design and space planning, and renovation and re-positioning. The Company provides its customers with services, such as build-to-suit construction and space modification, including tenant improvements and expansions.

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