Financial Contrast: Orion Office REIT (NYSE:ONL) vs. JBG SMITH Properties (NYSE:JBGS)

JBG SMITH Properties (NYSE:JBGS) and Orion Office REIT (NYSE:ONL) are both small-cap real estate companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, profitability, earnings, institutional ownership, valuation and risk.

Profitability

This table compares JBG SMITH Properties and Orion Office REIT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
JBG SMITH Properties	-39.73%	-18.71%	-4.78%
Orion Office REIT	-19.89%	-4.50%	-2.42%

Volatility and Risk

JBG SMITH Properties has a beta of 1.12, indicating that its stock price is 12% more volatile than the S&P 500. Comparatively, Orion Office REIT has a beta of 1.59, indicating that its stock price is 59% more volatile than the S&P 500.

Institutional and Insider Ownership

98.5% of JBG SMITH Properties shares are owned by institutional investors. Comparatively, 79.9% of Orion Office REIT shares are owned by institutional investors. 11.9% of JBG SMITH Properties shares are owned by insiders. Comparatively, 1.6% of Orion Office REIT shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares JBG SMITH Properties and Orion Office REIT”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
JBG SMITH Properties	$498.60 million	1.41	-$139.06 million	($3.54)	-3.44
Orion Office REIT	$141.23 million	1.07	-$139.31 million	($0.52)	-5.09

JBG SMITH Properties has higher revenue and earnings than Orion Office REIT. Orion Office REIT is trading at a lower price-to-earnings ratio than JBG SMITH Properties, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and price targets for JBG SMITH Properties and Orion Office REIT, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
JBG SMITH Properties	3	0	0	0	1.00
Orion Office REIT	1	0	1	0	2.00

JBG SMITH Properties currently has a consensus target price of $12.50, suggesting a potential upside of 2.69%. Orion Office REIT has a consensus target price of $3.50, suggesting a potential upside of 32.33%. Given Orion Office REIT’s stronger consensus rating and higher possible upside, analysts plainly believe Orion Office REIT is more favorable than JBG SMITH Properties.

Dividends

JBG SMITH Properties pays an annual dividend of $0.70 per share and has a dividend yield of 5.8%. Orion Office REIT pays an annual dividend of $0.08 per share and has a dividend yield of 3.0%. JBG SMITH Properties pays out -19.8% of its earnings in the form of a dividend. Orion Office REIT pays out -15.4% 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. JBG SMITH Properties is clearly the better dividend stock, given its higher yield and lower payout ratio.

About JBG SMITH Properties

JBG SMITH Properties is a real estate investment trust that owns, operates and develops residential, office and retail properties. Its portfolio is concentrated in the Washington, D.C., metropolitan area, with a significant presence in National Landing, Virginia, as well as properties in the District and suburban Maryland. The company focuses on urban, mixed-use and transit-oriented communities, serving residents, businesses and retail tenants. Its activities include leasing and managing existing properties and developing projects intended to bring housing, workplaces and services together.

About Orion Office REIT

Orion Office REIT Inc. (NYSE: ONL) is a real estate investment trust focused on owning and managing office properties. Its portfolio has primarily consisted of office buildings leased to single tenants, with an emphasis on properties occupied by creditworthy tenants and supported by long-term leases. The company was formed through a 2021 spin-off from Realty Income Corporation. At the time of the separation, Orion Office REIT received a portfolio of office properties located across multiple U.S. states, serving tenants in a range of industries and government-related sectors.