Physicians Realty Trust (DOC) versus Howard Hughes (HHC) Financial Analysis

Physicians Realty Trust (NYSE:DOC) and Howard Hughes (NYSE:HHC) are both mid-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, profitability, dividends, earnings, analyst recommendations, valuation and risk.

Dividends

Physicians Realty Trust pays an annual dividend of $0.92 per share and has a dividend yield of 5.0%. Howard Hughes does not pay a dividend. Physicians Realty Trust pays out 85.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Physicians Realty Trust has increased its dividend for 2 consecutive years.

Analyst Recommendations

This is a summary of recent recommendations for Physicians Realty Trust and Howard Hughes, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Physicians Realty Trust 0 4 5 0 2.56
Howard Hughes 0 0 2 0 3.00

Physicians Realty Trust presently has a consensus target price of $18.13, indicating a potential downside of 0.86%. Howard Hughes has a consensus target price of $160.00, indicating a potential upside of 49.91%. Given Howard Hughes’ stronger consensus rating and higher possible upside, analysts clearly believe Howard Hughes is more favorable than Physicians Realty Trust.

Risk & Volatility

Physicians Realty Trust has a beta of 0.59, indicating that its share price is 41% less volatile than the S&P 500. Comparatively, Howard Hughes has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500.

Insider & Institutional Ownership

94.1% of Physicians Realty Trust shares are held by institutional investors. Comparatively, 84.7% of Howard Hughes shares are held by institutional investors. 0.6% of Physicians Realty Trust shares are held by insiders. Comparatively, 7.5% of Howard Hughes 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.

Profitability

This table compares Physicians Realty Trust and Howard Hughes’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Physicians Realty Trust 13.34% 2.28% 1.35%
Howard Hughes 6.95% 2.71% 1.20%

Earnings & Valuation

This table compares Physicians Realty Trust and Howard Hughes’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Physicians Realty Trust $422.55 million 8.02 $56.23 million $1.08 16.94
Howard Hughes $1.06 billion 4.33 $57.01 million $1.32 80.86

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

Summary

Howard Hughes beats Physicians Realty Trust on 10 of the 17 factors compared between the two stocks.

About Physicians Realty Trust

Physicians Realty Trust is a self-managed healthcare real estate company organized to acquire, selectively develop, own and manage healthcare properties that are leased to physicians, hospitals and healthcare delivery systems. The Company invests in real estate that is integral to providing high quality healthcare. The Company conducts its business through an UPREIT structure in which its properties are owned by Physicians Realty L.P., a Delaware limited partnership (the “operating partnership”), directly or through limited partnerships, limited liability companies or other subsidiaries. The Company is the sole general partner of the operating partnership and, as of March 31, 2019, owned approximately 97.3% of OP units.

About Howard Hughes

The Howard Hughes Corporation owns, manages, and develops commercial, residential, and hospitality operating properties in the United States. It operates through three segments: Operating Assets, Master Planned Communities, and Strategic Developments. The Operating Assets segment owns 15 retail, 28 office, 8 multi-family, and 4 hospitality properties, as well as 10 other operating assets and investments primarily located and around The Woodlands, Texas; Columbia, Maryland; New York, New York; Las Vegas, Nevada; and Honolulu, Hawai‘i. The Master Planned Communities segment develops and sells residential and commercial land. This segment sells residential land designated for detached and attached single family homes ranging from entry-level to luxury homes; and commercial land parcels designated for retail, office, hospitality, and high density residential projects, as well as services and other for-profit activities, and parcels designated for use by government, schools, and other not-for-profit entities. As of December 31, 2018, this segment had 10,543 remaining saleable acres of land. The Strategic Development segment comprises residential condominium and commercial property projects. This segment consist of 29 development or redevelopment projects. The company was founded in 2010 and is headquartered in Dallas, Texas.

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