Store Capital (NYSE:STOR) and MGM Growth Properties (NYSE:MGP) are both mid-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, valuation, risk, earnings and profitability.
Volatility and Risk
Store Capital has a beta of 0.18, meaning that its share price is 82% less volatile than the S&P 500. Comparatively, MGM Growth Properties has a beta of 0.47, meaning that its share price is 53% less volatile than the S&P 500.
This is a summary of current ratings and recommmendations for Store Capital and MGM Growth Properties, as provided by MarketBeat.com.
||Strong Buy Ratings
|MGM Growth Properties
Store Capital presently has a consensus target price of $37.14, indicating a potential downside of 7.21%. MGM Growth Properties has a consensus target price of $34.44, indicating a potential upside of 13.68%. Given MGM Growth Properties’ higher possible upside, analysts clearly believe MGM Growth Properties is more favorable than Store Capital.
Earnings and Valuation
This table compares Store Capital and MGM Growth Properties’ gross revenue, earnings per share and valuation.
||Earnings Per Share
|MGM Growth Properties
Store Capital has higher earnings, but lower revenue than MGM Growth Properties. MGM Growth Properties is trading at a lower price-to-earnings ratio than Store Capital, indicating that it is currently the more affordable of the two stocks.
Store Capital pays an annual dividend of $1.40 per share and has a dividend yield of 3.5%. MGM Growth Properties pays an annual dividend of $1.88 per share and has a dividend yield of 6.2%. Store Capital pays out 76.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. MGM Growth Properties pays out 84.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Institutional and Insider Ownership
90.5% of Store Capital shares are owned by institutional investors. Comparatively, 95.9% of MGM Growth Properties shares are owned by institutional investors. 0.8% of Store Capital shares are owned by company insiders. Comparatively, 0.5% of MGM Growth Properties shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
This table compares Store Capital and MGM Growth Properties’ net margins, return on equity and return on assets.
||Return on Equity
||Return on Assets
|MGM Growth Properties
Store Capital beats MGM Growth Properties on 9 of the 15 factors compared between the two stocks.
About Store Capital
STORE Capital Corporation is an internally managed net-lease real estate investment trust, or REIT, that is the leader in the acquisition, investment and management of Single Tenant Operational Real Estate, which is its target market and the inspiration for its name. STORE Capital is one of the largest and fastest growing net-lease REITs and owns a large, well-diversified portfolio that consists of investments in 2,255 property locations, substantially all of which are profit centers, in 49 states.
About MGM Growth Properties
MGM Growth Properties LLC (NYSE:MGP) is one of the leading publicly traded real estate investment trusts engaged in the acquisition, ownership and leasing of large-scale destination entertainment and leisure resorts, whose diverse amenities include casino gaming, hotel, convention, dining, entertainment and retail offerings. MGP currently owns a portfolio of properties, consisting of 11 premier destination resorts in Las Vegas and elsewhere across the United States, the Hard Rock Rocksino Northfield Park in Northfield, OH, Empire Resort Casino in Yonkers, NY, as well as a retail and entertainment district, The Park in Las Vegas. As of December 31, 2018, our destination resorts, the Park, and Northfield Park collectively comprise approximately 27,500 hotel rooms, 2.7 million convention square footage, 150 retail outlets, 300 food and beverage outlets and 20 entertainment venues. As a growth-oriented public real estate entity, MGP expects its relationship with MGM Resorts and other entertainment providers to attractively position MGP for the acquisition of additional properties across the entertainment, hospitality and leisure industries.
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