Critical Survey: Rexford Industrial Realty (NYSE:REXR) versus Granite Real Estate Inc. Staple (NYSE:GRP.U)

Rexford Industrial Realty (NYSE:REXR) and Granite Real Estate Inc. Staple (NYSE:GRP.U) are both mid-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, dividends, valuation, institutional ownership and earnings.

Insider and Institutional Ownership

99.5% of Rexford Industrial Realty shares are held by institutional investors. Comparatively, 57.1% of Granite Real Estate Inc. Staple shares are held by institutional investors. 1.2% of Rexford Industrial Realty shares are held by insiders. Comparatively, 0.3% of Granite Real Estate Inc. Staple shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Rexford Industrial Realty pays an annual dividend of $1.72 per share and has a dividend yield of 4.4%. Granite Real Estate Inc. Staple pays an annual dividend of $1.37 per share and has a dividend yield of 2.9%. Rexford Industrial Realty pays out 142.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Granite Real Estate Inc. Staple pays out 32.9% of its earnings in the form of a dividend.

Profitability

This table compares Rexford Industrial Realty and Granite Real Estate Inc. Staple’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rexford Industrial Realty	29.10%	3.26%	2.19%
Granite Real Estate Inc. Staple	55.97%	5.71%	3.34%

Analyst Recommendations

This is a summary of recent recommendations and price targets for Rexford Industrial Realty and Granite Real Estate Inc. Staple, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rexford Industrial Realty	1	7	3	0	2.18
Granite Real Estate Inc. Staple	0	0	0	0	0.00

Rexford Industrial Realty presently has a consensus target price of $48.50, indicating a potential upside of 24.35%. Given Rexford Industrial Realty’s stronger consensus rating and higher probable upside, analysts clearly believe Rexford Industrial Realty is more favorable than Granite Real Estate Inc. Staple.

Valuation & Earnings

This table compares Rexford Industrial Realty and Granite Real Estate Inc. Staple”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rexford Industrial Realty	$936.41 million	9.49	$273.80 million	$1.21	32.23
Granite Real Estate Inc. Staple	$569.14 million	5.15	$101.24 million	$4.17	11.30

Rexford Industrial Realty has higher revenue and earnings than Granite Real Estate Inc. Staple. Granite Real Estate Inc. Staple is trading at a lower price-to-earnings ratio than Rexford Industrial Realty, indicating that it is currently the more affordable of the two stocks.

Summary

Rexford Industrial Realty beats Granite Real Estate Inc. Staple on 10 of the 15 factors compared between the two stocks.

About Rexford Industrial Realty

Rexford Industrial Realty, Inc. is a self-administered and self-managed real estate investment trust, which engages in owning and operating industrial properties in infill markets. The company was founded by Richard S. Ziman on January 18, 2013 and is headquartered in Los Angeles, CA.

About Granite Real Estate Inc. Staple

Granite Real Estate Investment Trust is engaged in the ownership and management of predominantly industrial properties in Canada, the United States, Mexico and Europe. The Company owns and manages rental income properties. Its services include sourcing and real estate acquisition, site development, assisting with government approvals and re-zoning to specific uses, build-to-suit construction, property renovation, project management and long-term leasing. Granite Real Estate Investment Trust, formerly known as Granite Real Estate Inc., is based in Toronto, Canada.