Taubman Centers (NYSE: TCO) and Four Corners Property Trust (NYSE:FCPT) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, profitability, valuation, analyst recommendations, risk, institutional ownership and dividends.
Taubman Centers pays an annual dividend of $2.50 per share and has a dividend yield of 4.8%. Four Corners Property Trust pays an annual dividend of $0.97 per share and has a dividend yield of 3.9%. Taubman Centers pays out 193.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Four Corners Property Trust pays out 71.9% of its earnings in the form of a dividend. Taubman Centers has increased its dividend for 7 consecutive years. Taubman Centers is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
98.4% of Taubman Centers shares are held by institutional investors. Comparatively, 85.9% of Four Corners Property Trust shares are held by institutional investors. 31.2% of Taubman Centers shares are held by company insiders. Comparatively, 0.2% of Four Corners Property Trust shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
This table compares Taubman Centers and Four Corners Property Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Four Corners Property Trust||63.74%||17.21%||8.58%|
This is a breakdown of recent ratings for Taubman Centers and Four Corners Property Trust, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Four Corners Property Trust||0||2||2||0||2.50|
Taubman Centers currently has a consensus price target of $73.67, suggesting a potential upside of 41.07%. Four Corners Property Trust has a consensus price target of $26.33, suggesting a potential upside of 5.38%. Given Taubman Centers’ higher possible upside, equities research analysts plainly believe Taubman Centers is more favorable than Four Corners Property Trust.
Risk and Volatility
Taubman Centers has a beta of 0.49, meaning that its share price is 51% less volatile than the S&P 500. Comparatively, Four Corners Property Trust has a beta of 0.15, meaning that its share price is 85% less volatile than the S&P 500.
Earnings & Valuation
This table compares Taubman Centers and Four Corners Property Trust’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Taubman Centers||$606.47 million||5.23||$311.97 million||$1.29||40.48|
|Four Corners Property Trust||$127.93 million||11.95||$98.64 million||$1.35||18.51|
Taubman Centers has higher revenue and earnings than Four Corners Property Trust. Four Corners Property Trust is trading at a lower price-to-earnings ratio than Taubman Centers, indicating that it is currently the more affordable of the two stocks.
Taubman Centers beats Four Corners Property Trust on 9 of the 17 factors compared between the two stocks.
About Taubman Centers
Taubman Centers, Inc. is a self-administered and self-managed real estate investment trust (REIT). The Company’s segment is focused on owning, developing and managing regional shopping centers. The Taubman Realty Group Limited Partnership (the Operating Partnership or TRG) is majority-owned partnership subsidiary of the Company that owns direct or indirect interests in all of its real estate properties. The Company owns, leases, acquires, disposes of, develops, expands and manages regional and super-regional shopping centers and interests therein. Its owned portfolio of operating centers as of December 31, 2016 consisted of 23 urban and suburban shopping centers operating in 11 the United States states, Puerto Rico, South Korea, and China. The consolidated businesses consist of shopping centers and entities that are controlled by ownership or contractual agreements, The Taubman Company LLC (Manager), and Taubman Properties Asia LLC and its subsidiaries (Taubman Asia).
About Four Corners Property Trust
Four Corners Property Trust, Inc. is a self-administered company and real estate investment trust (REIT), which owns, acquires and leases properties for use in the restaurant and food service related industries. The Company operates through two segments: real estate operations and restaurant operations. Its real estate operations segment consists of rental revenues primarily generated by leasing restaurant properties to tenants through triple-net lease arrangements under which the tenant is primarily responsible for ongoing costs relating to the properties. Its restaurant operations segment is conducted through its taxable REIT subsidiary, Kerrow Holdings, LLC, and consists of its Kerrow Restaurant Operating Business. As of December 31, 2016, it had owned 481 properties, all within the continental United States. Of these properties, 475 were held for investment and leased to tenants under triple-net leases and had an aggregate leasable area of approximately 3.4 million square feet.
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