Empire State Realty Trust (ESRT) vs. Its Rivals Financial Review

Empire State Realty Trust (NYSE: ESRT) is one of 77 publicly-traded companies in the “Commercial REITs” industry, but how does it compare to its peers? We will compare Empire State Realty Trust to similar companies based on the strength of its dividends, valuation, profitability, institutional ownership, risk, analyst recommendations and earnings.

Institutional & Insider Ownership

82.5% of Empire State Realty Trust shares are owned by institutional investors. Comparatively, 73.2% of shares of all “Commercial REITs” companies are owned by institutional investors. 11.8% of Empire State Realty Trust shares are owned by insiders. Comparatively, 7.3% of shares of all “Commercial REITs” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Empire State Realty Trust and its peers gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Empire State Realty Trust $678.00 million $52.39 million 52.00
Empire State Realty Trust Competitors $537.26 million $100.34 million 426.94

Empire State Realty Trust has higher revenue, but lower earnings than its peers. Empire State Realty Trust is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Dividends

Empire State Realty Trust pays an annual dividend of $0.42 per share and has a dividend yield of 2.1%. Empire State Realty Trust pays out 107.7% 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, “Commercial REITs” companies pay a dividend yield of 3.9% and pay out 92.1% of their earnings in the form of a dividend. Empire State Realty Trust lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.

Risk and Volatility

Empire State Realty Trust has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500. Comparatively, Empire State Realty Trust’s peers have a beta of 0.77, meaning that their average stock price is 23% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Empire State Realty Trust and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Empire State Realty Trust 0 1 1 0 2.50
Empire State Realty Trust Competitors 634 2591 2231 24 2.30

Empire State Realty Trust currently has a consensus target price of $22.33, suggesting a potential upside of 10.12%. As a group, “Commercial REITs” companies have a potential upside of 8.02%. Given Empire State Realty Trust’s stronger consensus rating and higher probable upside, research analysts clearly believe Empire State Realty Trust is more favorable than its peers.

Profitability

This table compares Empire State Realty Trust and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Empire State Realty Trust 11.90% 3.98% 2.04%
Empire State Realty Trust Competitors 52.55% 6.66% 3.86%

Summary

Empire State Realty Trust peers beat Empire State Realty Trust on 8 of the 15 factors compared.

Empire State Realty Trust Company Profile

Empire State Realty Trust, Inc. is a real estate investment trust. The Company owns, manages, operates, acquires and repositions office and retail properties in Manhattan and the greater New York metropolitan area, including the Empire State Building. The Company operates through two segments: Real Estate and Observatory. The Real Estate segment includes all activities related to the ownership, management, operation, acquisition, repositioning and disposition of its real estate assets. The Observatory segment operates the 86th and 102nd floor observatories at the Empire State Building. As of December 31, 2016, its portfolio consisted of 14 office properties and six standalone retail properties totaling approximately 10.1 million rentable square feet. The Company’s properties include One Grand Central Place, 1400 Broadway, 111 West 33rd Street, 250 West 57th Street, 1359 Broadway and 1333 Broadway.

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