Optibase (NASDAQ:OBAS) and FirstService (FSV) Financial Review

FirstService (NASDAQ:FSV) and Optibase (NASDAQ:OBAS) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, dividends, analyst recommendations, valuation, profitability, risk and institutional ownership.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for FirstService and Optibase, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
FirstService 0 4 0 0 2.00
Optibase 0 0 0 0 N/A

FirstService presently has a consensus target price of $86.67, suggesting a potential downside of 1.28%. Given FirstService’s higher probable upside, analysts plainly believe FirstService is more favorable than Optibase.

Volatility and Risk

FirstService has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500. Comparatively, Optibase has a beta of 0.6, meaning that its share price is 40% less volatile than the S&P 500.

Profitability

This table compares FirstService and Optibase’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
FirstService 3.12% 23.44% 6.10%
Optibase -16.75% -3.66% -1.11%

Valuation and Earnings

This table compares FirstService and Optibase’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
FirstService $1.93 billion 1.64 $65.86 million $1.80 48.77
Optibase $16.61 million 3.24 -$2.78 million N/A N/A

FirstService has higher revenue and earnings than Optibase.

Dividends

FirstService pays an annual dividend of $0.60 per share and has a dividend yield of 0.7%. Optibase does not pay a dividend. FirstService pays out 33.3% of its earnings in the form of a dividend. FirstService has raised its dividend for 3 consecutive years.

Insider & Institutional Ownership

70.4% of FirstService shares are owned by institutional investors. Comparatively, 0.2% of Optibase shares are owned by institutional investors. 17.1% of Optibase shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

FirstService beats Optibase on 10 of the 13 factors compared between the two stocks.

FirstService Company Profile

FirstService Corporation, together with its subsidiaries, provides residential property services to residential and commercial customers in the United States and Canada. The company operates through two segments, FirstService Residential and FirstService Brands. The FirstService Residential segment provides property management services for private residential communities, such as condominiums, co-operatives, homeowner associations, master-planned communities, active adult and lifestyle communities, and various other residential developments. This segment also offers a range of ancillary services, including on-site staffing for building engineering and maintenance, full-service amenity management, security and concierge/front desk, and landscaping; and financial services comprising cash management, other banking transaction-related services, and specialized property insurance brokerage. In addition, this segment provides energy management solutions and advisory services, and resale processing services. The FirstService Brands segment offers property services through 6 franchise networks; and company-owned locations, including 18 California Closets locations and 9 Paul Davis Restoration locations. It offers residential and commercial restoration, painting, and floor coverings design and installation services; custom-designed and installed closet, and home storage solutions; home inspection services; exterior residential painting and window cleaning services; fire protection services; and heating, ventilation, and air conditioning services, as well as related services. This segment provides its services primarily under the Paul Davis Restoration, CertaPro Painters, California Closets, Pillar to Post Home Inspectors, Floor Coverings International, College Pro Painters, and Century Fire Protection brand names. FirstService Corporation was founded in 1988 and is headquartered in Toronto, Canada.

Optibase Company Profile

Optibase Ltd., together with its subsidiaries, operates in the fixed-income real estate sector in Switzerland, Germany, and the United States. The company purchases and operates real estate properties intended for leasing and resale primarily for the purpose of commercial, industrial, office space, parking garage, and warehouse use, as well as for residential purposes. The company was formerly known as Optibase Advanced Systems (1990) Ltd. and changed its name to Optibase Ltd. in November 1993. The company was founded in 1990 and is headquartered in Herzliya, Israel. Optibase Ltd. is a subsidiary of The Capri Family Foundation.

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