Financial Survey: Granite Real Estate Investment Trust (GRP) and First Industrial Realty Trust (FR)

Granite Real Estate Investment Trust (NYSE: GRP) and First Industrial Realty Trust (NYSE:FR) are both industrial reits companies, but which is the better business? We will compare the two companies based on the strength of their valuation, dividends, profitability, institutional ownership, risk, analyst recommendations and earnings.

Dividends

First Industrial Realty Trust pays an annual dividend of $0.84 per share and has a dividend yield of 2.7%. Granite Real Estate Investment Trust does not pay a dividend. First Industrial Realty Trust pays out 78.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. First Industrial Realty Trust has raised its dividend for 3 consecutive years.

Profitability

This table compares Granite Real Estate Investment Trust and First Industrial Realty Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Granite Real Estate Investment Trust N/A N/A N/A
First Industrial Realty Trust 32.44% 9.54% 4.47%

Institutional & Insider Ownership

92.1% of First Industrial Realty Trust shares are owned by institutional investors. 1.7% of First Industrial Realty Trust shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Volatility and Risk

Granite Real Estate Investment Trust has a beta of 1.99, indicating that its share price is 99% more volatile than the S&P 500. Comparatively, First Industrial Realty Trust has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for Granite Real Estate Investment Trust and First Industrial Realty Trust, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Granite Real Estate Investment Trust 0 2 0 0 2.00
First Industrial Realty Trust 0 4 3 0 2.43

Granite Real Estate Investment Trust presently has a consensus target price of $45.50, suggesting a potential upside of 11.63%. First Industrial Realty Trust has a consensus target price of $31.67, suggesting a potential upside of 0.31%. Given Granite Real Estate Investment Trust’s higher probable upside, equities analysts clearly believe Granite Real Estate Investment Trust is more favorable than First Industrial Realty Trust.

Earnings and Valuation

This table compares Granite Real Estate Investment Trust and First Industrial Realty Trust’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Granite Real Estate Investment Trust N/A N/A N/A $1.29 31.60
First Industrial Realty Trust $378.02 million 10.01 $121.23 million $1.07 29.50

First Industrial Realty Trust has higher revenue and earnings than Granite Real Estate Investment Trust. First Industrial Realty Trust is trading at a lower price-to-earnings ratio than Granite Real Estate Investment Trust, indicating that it is currently the more affordable of the two stocks.

Summary

First Industrial Realty Trust beats Granite Real Estate Investment Trust on 10 of the 14 factors compared between the two stocks.

About Granite Real Estate Investment Trust

Granite Real Estate Investment Trust is a real estate investment trust (REIT). It is engaged principally in the acquisition, development, construction, leasing, management and ownership of an industrial global rental portfolio of properties in North America and Europe leased primarily to Magna International Inc. and its automotive operating units. It is a service REIT with an international portfolio consisting of over 100 properties. It provides a range of services that includes sourcing and real estate acquisition, site development, assisting with government approvals and re-zoning to specific uses, build-to-suit construction, property renovation, project management and long-term leasing. In November 2013, Granite Real Estate Investment Trust completed its acquisition of a 2.5 million square foot portfolio of seven properties located in Germany and the Netherlands from funds managed by AEW Europe.

About First Industrial Realty Trust

First Industrial Realty Trust, Inc. is a real estate investment trust (REIT). The Trust is a self-administered real estate company, which owns, manages, acquires, sells, develops and redevelops industrial real estate. As of December 31, 2016, the Company’s in-service portfolio consisted of 215 light industrial properties, 53 research and development (R&D)/flex properties, 167 bulk warehouse properties and 100 regional warehouse properties containing an aggregate of approximately 62.2 million square feet of gross leasable area (GLA) located in 23 states. The Company’s in-service portfolio includes all properties that have reached stabilized occupancy, developed and redeveloped properties and acquired properties that are occupied at acquisition or one year from the acquisition date. The Company’s operations are conducted primarily through the First Industrial, L.P. (the Operating Partnership), of which the Company is the sole general partner.

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