Financial Contrast: Safehold (NYSE:SAFE) versus BRT Apartments (NYSE:BRT)

BRT Apartments (NYSE:BRT) and Safehold (NYSE:SAFE) are both small-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, valuation, institutional ownership, dividends, analyst recommendations, risk and earnings.

Dividends

BRT Apartments pays an annual dividend of $1.00 per share and has a dividend yield of 6.6%. Safehold pays an annual dividend of $0.71 per share and has a dividend yield of 5.2%. BRT Apartments pays out -196.1% of its earnings in the form of a dividend. Safehold pays out 45.2% 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. Safehold has raised its dividend for 1 consecutive years. BRT Apartments is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

29.1% of BRT Apartments shares are owned by institutional investors. Comparatively, 70.4% of Safehold shares are owned by institutional investors. 42.0% of BRT Apartments shares are owned by insiders. Comparatively, 3.5% of Safehold shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares BRT Apartments and Safehold”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BRT Apartments	$95.63 million	3.01	-$9.79 million	($0.51)	-29.65
Safehold	$365.68 million	2.70	$105.76 million	$1.57	8.76

Safehold has higher revenue and earnings than BRT Apartments. BRT Apartments is trading at a lower price-to-earnings ratio than Safehold, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and target prices for BRT Apartments and Safehold, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BRT Apartments	1	1	2	0	2.25
Safehold	0	7	4	0	2.36

BRT Apartments presently has a consensus target price of $19.75, suggesting a potential upside of 30.62%. Safehold has a consensus target price of $19.22, suggesting a potential upside of 39.70%. Given Safehold’s stronger consensus rating and higher probable upside, analysts clearly believe Safehold is more favorable than BRT Apartments.

Risk & Volatility

BRT Apartments has a beta of 0.97, suggesting that its stock price is 3% less volatile than the S&P 500. Comparatively, Safehold has a beta of 1.85, suggesting that its stock price is 85% more volatile than the S&P 500.

Profitability

This table compares BRT Apartments and Safehold’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BRT Apartments	-10.02%	-4.96%	-1.37%
Safehold	29.67%	4.78%	1.63%

Summary

Safehold beats BRT Apartments on 13 of the 17 factors compared between the two stocks.

About BRT Apartments

BRT Apartments Corp. is a real estate investment trust. It engages in the ownership, operation, and holding interests in joint ventures that own and operate multi-family properties. The company was founded in June 1972 and is headquartered in Great Neck, NY.

About Safehold

Safehold Inc. (NYSE: SAFE) is revolutionizing real estate ownership by providing a new and better way for owners to unlock the value of the land beneath their buildings. Having created the modern ground lease industry in 2017, Safehold continues to help owners of high quality multifamily, office, industrial, hospitality, student housing, life science and mixed-use properties generate higher returns with less risk. The Company, which is taxed as a real estate investment trust (REIT), seeks to deliver safe, growing income and long-term capital appreciation to its shareholders.