Excel Trust (EXL) vs. Empire State Realty Trust (ESRT) Critical Review

Excel Trust (NYSE: EXL) and Empire State Realty Trust (NYSE:ESRT) are both financials companies, but which is the superior business? We will compare the two companies based on the strength of their risk, valuation, earnings, dividends, institutional ownership, profitability and analyst recommendations.

Analyst Ratings

This is a summary of current ratings and price targets for Excel Trust and Empire State Realty Trust, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Excel Trust 0 0 0 0 N/A
Empire State Realty Trust 0 2 1 0 2.33

Empire State Realty Trust has a consensus target price of $22.33, suggesting a potential upside of 10.12%. Given Empire State Realty Trust’s higher possible upside, analysts clearly believe Empire State Realty Trust is more favorable than Excel Trust.

Volatility & Risk

Excel Trust has a beta of 0.49, meaning that its share price is 51% less volatile than the S&P 500. Comparatively, Empire State Realty Trust has a beta of 0.98, meaning that its share price is 2% less volatile than the S&P 500.

Valuation & Earnings

This table compares Excel Trust and Empire State Realty Trust’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Excel Trust N/A N/A N/A $0.26 60.92
Empire State Realty Trust $678.00 million 4.74 $52.39 million $0.39 52.00

Empire State Realty Trust has higher revenue and earnings than Excel Trust. Empire State Realty Trust is trading at a lower price-to-earnings ratio than Excel Trust, indicating that it is currently the more affordable of the two stocks.

Profitability

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

Net Margins Return on Equity Return on Assets
Excel Trust 9.45% 0.65% 0.88%
Empire State Realty Trust 11.90% 3.98% 2.04%

Insider and Institutional Ownership

82.5% of Empire State Realty Trust shares are held by institutional investors. 11.8% of Empire State Realty Trust shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Empire State Realty Trust pays an annual dividend of $0.42 per share and has a dividend yield of 2.1%. Excel Trust does not pay a dividend. 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. Empire State Realty Trust has raised its dividend for 7 consecutive years.

Summary

Empire State Realty Trust beats Excel Trust on 12 of the 13 factors compared between the two stocks.

About Excel Trust

Excel Trust, Inc. is a real estate investment trust (REIT). The Company is a vertically integrated, self-administered, self-managed real estate firm with the principal objective of acquiring, financing, developing, leasing, owning and managing community and power centers, grocery anchored neighborhood centers and freestanding retail properties. It operates through three segments: retail properties, multi-family properties and office properties. It owns approximately 38 consolidated retail operating properties with a total of approximately 7.2 million square feet of gross leasable area (GLA). The multi-family segment consists of apartment units at one retail property, West Broad Village, which is located in Richmond, Virginia. The office segment consists of two properties, Excel Centre, a portion of which is utilized as its headquarters, and the Promenade Corporate Center. These office properties total approximately 338,339 square feet of GLA.

About Empire State Realty Trust

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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