RMR Group (RMR) & Alexander & Baldwin Holdings (ALEX) Critical Analysis

RMR Group (NYSE: RMR) and Alexander & Baldwin Holdings (NYSE:ALEX) are both financials companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, valuation, risk, earnings, institutional ownership and dividends.

Valuation and Earnings

This table compares RMR Group and Alexander & Baldwin Holdings’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
RMR Group $230.67 million 3.69 $154.37 million N/A N/A
Alexander & Baldwin Holdings $405.40 million 5.55 $102.20 million $0.21 217.86

RMR Group has higher revenue, but lower earnings than Alexander & Baldwin Holdings.

Insider & Institutional Ownership

74.2% of Alexander & Baldwin Holdings shares are owned by institutional investors. 7.6% of Alexander & Baldwin Holdings 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.

Dividends

Alexander & Baldwin Holdings pays an annual dividend of $0.28 per share and has a dividend yield of 0.6%. RMR Group does not pay a dividend. Alexander & Baldwin Holdings pays out 133.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Alexander & Baldwin Holdings has raised its dividend for 3 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings and price targets for RMR Group and Alexander & Baldwin Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
RMR Group 0 3 2 0 2.40
Alexander & Baldwin Holdings 0 0 1 0 3.00

RMR Group presently has a consensus price target of $59.50, indicating a potential upside of 12.48%. Alexander & Baldwin Holdings has a consensus price target of $50.00, indicating a potential upside of 9.29%. Given RMR Group’s higher probable upside, equities analysts plainly believe RMR Group is more favorable than Alexander & Baldwin Holdings.

Profitability

This table compares RMR Group and Alexander & Baldwin Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
RMR Group 31.72% 18.72% 17.66%
Alexander & Baldwin Holdings 2.09% 3.72% 2.07%

Summary

Alexander & Baldwin Holdings beats RMR Group on 8 of the 15 factors compared between the two stocks.

RMR Group Company Profile

The RMR Group Inc. is a holding company. The Company’s business is primarily conducted by its subsidiary, The RMR Group LLC (RMR LLC). The Company’s segments include RMR LLC and All Other Operations. RMR LLC manages a portfolio of publicly owned real estate and real estate related businesses. RMR LLC manages Government Properties Income Trust, a real estate investment trust (REIT) that primarily owns properties that are leased to government tenants; Hospitality Properties Trust, an REIT that primarily owns hotels and travel centers; Select Income REIT, an REIT that primarily owns properties leased to single tenants across the United States and leased lands in Hawaii, and Senior Housing Properties Trust, an REIT that primarily owns senior living communities and medical office buildings. As of June 30, 2016, RMR LLC managed over 1,300 properties, which were located in 48 states, Washington, District of Columbia, Puerto Rico and Canada.

Alexander & Baldwin Holdings Company Profile

Alexander & Baldwin, Inc. (A&B) is a real estate company. The Company operates through three segments: Commercial Real Estate, Land Operations, and Materials and Construction. In addition to its 15 retail centers in Hawaii, the Company owned seven industrial assets, seven office properties and a portfolio of urban ground leases comprising 106 acres in Hawaii, as of December 31, 2016. On the United States mainland, the Company owned seven remaining commercial assets, as of December 31, 2016. The Commercial Real Estate segment owns, operates and manages retail, industrial and office properties in Hawaii and on the Mainland. The Land Operations segment manages the Company’s land and real estate-related assets and deploys these assets to their use. The Materials and Construction segment performs asphalt paving as prime contractor and subcontractor; imports and sells liquid asphalt; mines, processes and sells basalt aggregate, and produces and sells asphaltic and ready-mix concrete.

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