Contrasting COPT Defense Properties (NYSE:CDP) and Kilroy Realty (NYSE:KRC)

COPT Defense Properties (NYSE:CDP) and Kilroy Realty (NYSE:KRC) are both mid-cap real estate companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, institutional ownership, risk, dividends, analyst recommendations and profitability.

Volatility & Risk

COPT Defense Properties has a beta of 0.77, indicating that its share price is 23% less volatile than the S&P 500. Comparatively, Kilroy Realty has a beta of 1.16, indicating that its share price is 16% more volatile than the S&P 500.

Valuation & Earnings

This table compares COPT Defense Properties and Kilroy Realty”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
COPT Defense Properties	$763.92 million	5.09	$152.32 million	$1.44	23.82
Kilroy Realty	$1.11 billion	3.90	$276.12 million	$0.24	155.47

Kilroy Realty has higher revenue and earnings than COPT Defense Properties. COPT Defense Properties is trading at a lower price-to-earnings ratio than Kilroy Realty, indicating that it is currently the more affordable of the two stocks.

Dividends

COPT Defense Properties pays an annual dividend of $1.28 per share and has a dividend yield of 3.7%. Kilroy Realty pays an annual dividend of $2.16 per share and has a dividend yield of 5.8%. COPT Defense Properties pays out 88.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Kilroy Realty pays out 900.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares COPT Defense Properties and Kilroy Realty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
COPT Defense Properties	20.94%	10.48%	3.64%
Kilroy Realty	2.63%	0.52%	0.27%

Institutional and Insider Ownership

94.2% of Kilroy Realty shares are owned by institutional investors. 1.7% of COPT Defense Properties shares are owned by insiders. Comparatively, 0.8% of Kilroy Realty shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations for COPT Defense Properties and Kilroy Realty, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
COPT Defense Properties	0	3	5	0	2.62
Kilroy Realty	2	9	4	0	2.13

COPT Defense Properties presently has a consensus target price of $38.00, indicating a potential upside of 10.80%. Kilroy Realty has a consensus target price of $38.62, indicating a potential upside of 3.49%. Given COPT Defense Properties’ stronger consensus rating and higher probable upside, equities research analysts plainly believe COPT Defense Properties is more favorable than Kilroy Realty.

Summary

COPT Defense Properties beats Kilroy Realty on 10 of the 16 factors compared between the two stocks.

About COPT Defense Properties

COPT Defense Properties is a real estate investment trust. It acquires, develops, manages, sells, and leases out office properties and data centers. The firm operates through the following segments: Defense/Information Technology Locations, Regional Office, Wholesale Data Center, and Other. The company was founded on January 22,1988 and is headquartered in Columbia, MD.

About Kilroy Realty

Kilroy Realty Corporation (NYSE: KRC, the company, Kilroy) is a leading U.S. landlord and developer, with operations in San Diego, Greater Los Angeles, the San Francisco Bay Area, Greater Seattle and Austin. The company has earned global recognition for sustainability, building operations, innovation and design. As a pioneer and innovator in the creation of a more sustainable real estate industry, the company's approach to modern business environments helps drive creativity and productivity for some of the world's leading technology, entertainment, life science and business services companies. The company is a publicly traded real estate investment trust (REIT) and member of the S&P MidCap 400 Index with more than seven decades of experience developing, acquiring and managing office, life science and mixed-use projects. As of December 31, 2023, Kilroy's stabilized portfolio totaled approximately 17.0 million square feet of primarily office and life science space that was 85.0% occupied and 86.4% leased. The company also had approximately 1,000 residential units in Hollywood and San Diego, which had a quarterly average occupancy of 92.5%. In addition, the company had two in-process life science redevelopment projects totaling approximately 100,000 square feet with total estimated redevelopment costs of $80.0 million and one approximately 875,000 square foot in-process development project with a total estimated investment of $1.0 billion.