Four Corners Property Trust (FCPT) vs. Pennsylvania Real Estate Investment Trust (PEI) Head to Head Comparison

Four Corners Property Trust (NYSE: FCPT) and Pennsylvania Real Estate Investment Trust (NYSE:PEI) are both small-cap financials companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, risk, institutional ownership, profitability, valuation and earnings.

Profitability

This table compares Four Corners Property Trust and Pennsylvania Real Estate Investment Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Four Corners Property Trust 65.46% 17.37% 8.56%
Pennsylvania Real Estate Investment Trust -16.35% -7.60% -2.34%

Valuation and Earnings

This table compares Four Corners Property Trust and Pennsylvania Real Estate Investment Trust’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Four Corners Property Trust $124.02 million 12.50 $156.80 million $1.41 17.97
Pennsylvania Real Estate Investment Trust $399.95 million 1.80 -$11.34 million ($1.24) -8.31

Four Corners Property Trust has higher earnings, but lower revenue than Pennsylvania Real Estate Investment Trust. Pennsylvania Real Estate Investment Trust is trading at a lower price-to-earnings ratio than Four Corners Property Trust, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

86.5% of Four Corners Property Trust shares are owned by institutional investors. Comparatively, 99.0% of Pennsylvania Real Estate Investment Trust shares are owned by institutional investors. 0.2% of Four Corners Property Trust shares are owned by company insiders. Comparatively, 4.4% of Pennsylvania Real Estate Investment Trust shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

Four Corners Property Trust pays an annual dividend of $0.97 per share and has a dividend yield of 3.8%. Pennsylvania Real Estate Investment Trust pays an annual dividend of $0.84 per share and has a dividend yield of 8.1%. Four Corners Property Trust pays out 68.8% of its earnings in the form of a dividend. Pennsylvania Real Estate Investment Trust pays out -67.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Pennsylvania Real Estate Investment Trust has increased its dividend for 5 consecutive years. Pennsylvania Real Estate Investment Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Four Corners Property Trust and Pennsylvania Real Estate Investment Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Four Corners Property Trust 0 1 2 0 2.67
Pennsylvania Real Estate Investment Trust 1 6 0 0 1.86

Four Corners Property Trust currently has a consensus price target of $26.67, indicating a potential upside of 5.24%. Pennsylvania Real Estate Investment Trust has a consensus price target of $13.83, indicating a potential upside of 34.17%. Given Pennsylvania Real Estate Investment Trust’s higher possible upside, analysts clearly believe Pennsylvania Real Estate Investment Trust is more favorable than Four Corners Property Trust.

Summary

Four Corners Property Trust beats Pennsylvania Real Estate Investment Trust on 9 of the 16 factors compared between the two stocks.

Four Corners Property Trust Company Profile

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.

Pennsylvania Real Estate Investment Trust Company Profile

Pennsylvania Real Estate Investment Trust (PREIT) is a self-managed and self-administered real estate investment trust (REIT). The Company’s primary business is owning and operating retail shopping malls, which it does primarily through operating partnership, PREIT Associates, L.P. (PREIT Associates). The Company is engaged in the ownership, management, leasing, acquisition, redevelopment, development and disposition of shopping malls. The Company has a primary investment focus on retail shopping malls located in the eastern half of the United States, primarily in the Mid-Atlantic region. As of December 31, 2016, the Company owned interests in 30 retail properties, of which 26 are operating properties and four are development or redevelopment properties. As of December 31, 2016, the Company’s 26 operating properties included 22 shopping malls and four other retail properties, had a total of 21.7 million square feet and were located in nine states.

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