Financial Contrast: Cole Real Estate Investments (COLE) versus Seritage Growth Properties (SRG)

Seritage Growth Properties (NYSE: SRG) and Cole Real Estate Investments (NYSE:COLE) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, earnings, analyst recommendations, dividends, profitability, institutional ownership and valuation.

Institutional and Insider Ownership

78.0% of Seritage Growth Properties shares are held by institutional investors. 9.8% of Seritage Growth Properties shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Seritage Growth Properties and Cole Real Estate Investments’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Seritage Growth Properties -17.97% -3.33% -1.67%
Cole Real Estate Investments N/A N/A N/A

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Seritage Growth Properties and Cole Real Estate Investments, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Seritage Growth Properties 1 1 0 0 1.50
Cole Real Estate Investments 0 0 0 0 N/A

Seritage Growth Properties currently has a consensus target price of $43.00, indicating a potential upside of 6.30%.

Dividends

Seritage Growth Properties pays an annual dividend of $1.00 per share and has a dividend yield of 2.5%. Cole Real Estate Investments does not pay a dividend. Seritage Growth Properties pays out -71.9% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Seritage Growth Properties and Cole Real Estate Investments’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Seritage Growth Properties $248.67 million 5.76 -$51.55 million ($1.39) -29.10
Cole Real Estate Investments N/A N/A N/A $0.20 N/A

Cole Real Estate Investments has lower revenue, but higher earnings than Seritage Growth Properties. Seritage Growth Properties is trading at a lower price-to-earnings ratio than Cole Real Estate Investments, indicating that it is currently the more affordable of the two stocks.

Summary

Seritage Growth Properties beats Cole Real Estate Investments on 5 of the 9 factors compared between the two stocks.

Seritage Growth Properties Company Profile

Seritage Growth Properties (Seritage) is a self-administered and self-managed real estate investment trust. The Company is engaged in the acquisition, ownership, development, redevelopment, management and leasing of diversified retail real estate throughout the United States. Its assets are held by and its operations are primarily conducted through, directly or indirectly, Seritage Growth Properties, L.P. (Operating Partnership). As of December 31, 2016, the Company’s portfolio included approximately 42.2 million square feet of gross leasable area (GLA), consisting of 235 owned properties totaling over 36.8 million square feet of GLA across 49 states and Puerto Rico, and interests in 31 joint venture properties totaling over 5.4 million square feet of GLA across 17 states. As of December 31, 2016, it included over 3,000 acres of land or approximately 13 acres per site for its owned properties. Its properties are primarily located in areas, including in California, Florida and Texas.

Cole Real Estate Investments Company Profile

Cole Real Estate Investments, Inc. is a real estate investment trust (REIT). The Company operates in two segments: Real Estate Investment (REI) and Private Capital Management (PCM). The Company’s REI segment is conducted through Cole REIT III Operating Partnership, LP (CCPT III OP). The Company’s PCM segment is conducted through Cole Capital Advisors, Inc. (CCA). Through its REI segment, the Company acquires and operates a diverse portfolio of core commercial real estate investments primarily consisting of necessity retail properties located throughout the United States, including United States protectorates. The Company’s PCM segment is responsible for managing the Managed REITs’ affairs on a day-to-day basis, identifying and making acquisitions and investments on the Managed REITs’ behalf. In February 2014, American Realty Capital Properties Inc purchased Cole Real Estate Investments, Inc.

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