Analyzing Terreno Realty (NYSE:TRNO) and Lineage (NASDAQ:LINE)

Terreno Realty (NYSE:TRNO) and Lineage (NASDAQ:LINE) are both mid-cap real estate companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, risk, earnings, profitability, analyst recommendations, dividends and valuation.

Risk & Volatility

Terreno Realty has a beta of 1.03, meaning that its stock price is 3% more volatile than the S&P 500. Comparatively, Lineage has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500.

Dividends

Terreno Realty pays an annual dividend of $2.08 per share and has a dividend yield of 3.1%. Lineage pays an annual dividend of $2.13 per share and has a dividend yield of 5.2%. Terreno Realty pays out 50.9% of its earnings in the form of a dividend. Lineage pays out -343.5% 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. Terreno Realty has raised its dividend for 5 consecutive years. Lineage is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares Terreno Realty and Lineage”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Terreno Realty	$476.38 million	15.22	$402.99 million	$4.09	16.67
Lineage	$5.36 billion	1.73	-$100.00 million	($0.62)	-65.55

Terreno Realty has higher earnings, but lower revenue than Lineage. Lineage is trading at a lower price-to-earnings ratio than Terreno Realty, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Terreno Realty and Lineage’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Terreno Realty	86.44%	10.35%	7.98%
Lineage	-3.15%	-1.83%	-0.88%

Analyst Recommendations

This is a summary of recent ratings for Terreno Realty and Lineage, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Terreno Realty	2	2	8	1	2.62
Lineage	4	9	5	0	2.06

Terreno Realty presently has a consensus target price of $71.71, suggesting a potential upside of 5.18%. Lineage has a consensus target price of $43.62, suggesting a potential upside of 7.34%. Given Lineage’s higher probable upside, analysts plainly believe Lineage is more favorable than Terreno Realty.

Summary

Terreno Realty beats Lineage on 12 of the 16 factors compared between the two stocks.

About Terreno Realty

Terreno Realty Corporation (Terreno, and together with its subsidiaries, the Company) acquires, owns and operates industrial real estate in six major coastal U.S. markets: Los Angeles, Northern New Jersey/New York City, San Francisco Bay Area, Seattle, Miami, and Washington, D.C. All square feet, acres, occupancy and number of properties disclosed in these notes to the consolidated financial statements are unaudited. As of December 31, 2023, the Company owned 259 buildings aggregating approximately 16.0 million square feet, 45 improved land parcels consisting of approximately 152.4 acres, seven properties under development or redevelopment and approximately 62.7 acres of land entitled for future development. The Company is an internally managed Maryland corporation and elected to be taxed as a real estate investment trust (REIT) under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the Code), commencing with its taxable year ended December 31, 2010.

About Lineage

Lineage, Inc. is the world’s largest global temperature-controlled warehouse REIT with a network of over 480 strategically located facilities totaling over 84.1 million square feet and 3.0 billion cubic feet of capacity across countries in North America, Europe, and Asia-Pacific. Coupling end-to-end supply chain solutions and technology, Lineage partners with some of the world’s largest food and beverage producers, retailers, and distributors to help increase distribution efficiency, advance sustainability, minimize supply chain waste, and, most importantly, feed the world.