Five Point (FPH) and The RMR Group (RMR) Critical Survey

The RMR Group (NASDAQ: RMR) and Five Point (NYSE:FPH) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, risk, earnings, dividends, analyst recommendations, institutional ownership and valuation.

Profitability

This table compares The RMR Group and Five Point’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The RMR Group 16.44% 10.14% 7.43%
Five Point -18.83% -2.30% -1.68%

Valuation & Earnings

This table compares The RMR Group and Five Point’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
The RMR Group $266.94 million 3.27 $37.24 million $2.78 20.81
Five Point $39.36 million 51.14 -$33.26 million N/A N/A

The RMR Group has higher revenue and earnings than Five Point.

Dividends

The RMR Group pays an annual dividend of $1.00 per share and has a dividend yield of 1.7%. Five Point does not pay a dividend. The RMR Group pays out 36.0% of its earnings in the form of a dividend.

Insider and Institutional Ownership

34.5% of The RMR Group shares are owned by institutional investors. Comparatively, 33.5% of Five Point shares are owned by institutional investors. 55.3% of The RMR Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for The RMR Group and Five Point, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The RMR Group 0 3 2 0 2.40
Five Point 0 2 4 0 2.67

The RMR Group presently has a consensus price target of $59.50, suggesting a potential upside of 2.85%. Five Point has a consensus price target of $19.70, suggesting a potential upside of 40.71%. Given Five Point’s stronger consensus rating and higher possible upside, analysts plainly believe Five Point is more favorable than The RMR Group.

Summary

The RMR Group beats Five Point on 8 of the 13 factors compared between the two stocks.

The 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.

Five Point Company Profile

Five Point Holdings, LLC, formerly Newhall Holding Company, LLC, is the owner and developer of mixed-use, planned communities in coastal California. The Company is primarily engaged in the business of planning and developing its three mixed-use, planned communities. It operates in three segments: Newhall, San Francisco and Great Park. Its three mixed-use, planned communities are: Newhall Ranch in Los Angeles County; The San Francisco Shipyard and Candlestick Point in the City of San Francisco; and Great Park Neighborhoods in Orange County. Newhall Ranch consists of approximately 15,000 acres in northern Los Angeles County. Newhall Ranch is designed to include approximately 21,500 home sites and approximately 11.5 million square feet of commercial space. The San Francisco Shipyard and Candlestick Point consists of approximately 800 acres of bay front property in the city of San Francisco. Great Park Neighborhoods consists of approximately 2,100 acres in Orange County, California.

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