Critical Survey: EastGroup Properties (NYSE:EGP) versus Big Yellow Group (OTCMKTS:BYLOF)

Big Yellow Group (OTCMKTS:BYLOF) and EastGroup Properties (NYSE:EGP) are both real estate companies, but which is the better business? We will compare the two companies based on the strength of their dividends, institutional ownership, profitability, earnings, analyst recommendations, valuation and risk.

Institutional and Insider Ownership

53.1% of Big Yellow Group shares are held by institutional investors. Comparatively, 92.1% of EastGroup Properties shares are held by institutional investors. 1.0% of EastGroup Properties shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

Big Yellow Group pays an annual dividend of $0.10 per share and has a dividend yield of 0.8%. EastGroup Properties pays an annual dividend of $6.20 per share and has a dividend yield of 3.1%. Big Yellow Group pays out 23.0% of its earnings in the form of a dividend. EastGroup Properties pays out 108.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. EastGroup Properties has raised its dividend for 4 consecutive years. EastGroup Properties is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Big Yellow Group and EastGroup Properties, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Big Yellow Group	0	1	2	0	2.67
EastGroup Properties	0	6	12	0	2.67

EastGroup Properties has a consensus price target of $221.11, suggesting a potential upside of 9.92%. Given EastGroup Properties’ higher probable upside, analysts clearly believe EastGroup Properties is more favorable than Big Yellow Group.

Valuation & Earnings

This table compares Big Yellow Group and EastGroup Properties”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Big Yellow Group	N/A	N/A	N/A	$0.43	28.77
EastGroup Properties	$721.34 million	14.99	$257.40 million	$5.70	35.29

EastGroup Properties has higher revenue and earnings than Big Yellow Group. Big Yellow Group is trading at a lower price-to-earnings ratio than EastGroup Properties, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Big Yellow Group and EastGroup Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Big Yellow Group	N/A	N/A	N/A
EastGroup Properties	40.47%	8.61%	5.59%

Summary

EastGroup Properties beats Big Yellow Group on 12 of the 13 factors compared between the two stocks.

About Big Yellow Group

Big Yellow is the UK's brand leader in self storage. Big Yellow now operates from a platform of 109 stores, including 24 stores branded as Armadillo Self Storage. We have a pipeline of 0.9 million sq ft comprising 13 proposed Big Yellow self storage facilities. The current maximum lettable area of the existing platform (including Armadillo) is 6.4 million sq ft. When fully built out the portfolio will provide approximately 7.3 million sq ft of flexible storage space. 99% of our stores and sites by value are held freehold and long leasehold, with the remaining 1% short leasehold. The Group has pioneered the development of the latest generation of self storage facilities, which utilise state of the art technology and are located in high profile, accessible, main road locations. Our focus on the location and visibility of our stores, with excellent customer service, a market-leading online platform, and significant and increasing investment in sustainability, has created in Big Yellow the most recognised brand name in the UK self storage industry.

About EastGroup Properties

EastGroup Properties, Inc. (NYSE: EGP), a member of the S&P Mid-Cap 400 and Russell 1000 Indexes, is a self-administered equity real estate investment trust focused on the development, acquisition and operation of industrial properties in major Sunbelt markets throughout the United States with an emphasis in the states of Florida, Texas, Arizona, California and North Carolina. The Company's goal is to maximize shareholder value by being a leading provider in its markets of functional, flexible and quality business distribution space for location sensitive customers (primarily in the 20,000 to 100,000 square foot range). The Company's strategy for growth is based on ownership of premier distribution facilities generally clustered near major transportation features in supply-constrained submarkets. The Company's portfolio, including development projects and value-add acquisitions in lease-up and under construction, currently includes approximately 59 million square feet.