Contrasting Whitestone REIT (NYSE:WSR) and Ladder Capital (NYSE:LADR)

Whitestone REIT (NYSE:WSR) and Ladder Capital (NYSE:LADR) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their risk, analyst recommendations, dividends, institutional ownership, earnings, valuation and profitability.

Profitability

This table compares Whitestone REIT and Ladder Capital’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Whitestone REIT 13.75% 4.55% 1.54%
Ladder Capital 22.51% 10.57% 2.72%

Risk and Volatility

Whitestone REIT has a beta of 1.01, indicating that its stock price is 1% more volatile than the S&P 500. Comparatively, Ladder Capital has a beta of 0.97, indicating that its stock price is 3% less volatile than the S&P 500.

Institutional and Insider Ownership

55.3% of Whitestone REIT shares are owned by institutional investors. Comparatively, 49.3% of Ladder Capital shares are owned by institutional investors. 5.6% of Whitestone REIT shares are owned by insiders. Comparatively, 12.0% of Ladder Capital shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Whitestone REIT and Ladder Capital’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Whitestone REIT $119.86 million 4.66 $21.43 million $1.16 11.84
Ladder Capital $595.14 million 3.41 $180.01 million $1.95 8.70

Ladder Capital has higher revenue and earnings than Whitestone REIT. Ladder Capital is trading at a lower price-to-earnings ratio than Whitestone REIT, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings for Whitestone REIT and Ladder Capital, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Whitestone REIT 0 1 2 0 2.67
Ladder Capital 0 2 0 0 2.00

Whitestone REIT presently has a consensus target price of $14.00, suggesting a potential upside of 1.89%. Ladder Capital has a consensus target price of $17.50, suggesting a potential upside of 3.12%. Given Ladder Capital’s higher possible upside, analysts plainly believe Ladder Capital is more favorable than Whitestone REIT.

Dividends

Whitestone REIT pays an annual dividend of $1.14 per share and has a dividend yield of 8.3%. Ladder Capital pays an annual dividend of $1.36 per share and has a dividend yield of 8.0%. Whitestone REIT pays out 98.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ladder Capital pays out 69.7% of its earnings in the form of a dividend.

Summary

Ladder Capital beats Whitestone REIT on 9 of the 16 factors compared between the two stocks.

About Whitestone REIT

Whitestone is a community-centered retail REIT that acquires, owns, manages, develops and redevelops high quality "E-Commerce resistant" neighborhood, community and lifestyle retail centers principally located in the largest, fastest growing and most affluent markets in the Sunbelt. Whitestone's optimal mix of national, regional and local tenants provides daily necessities, needed services and entertainment to the communities in which they are located. Whitestone's properties are primarily located in business-friendly Phoenix, Austin, Dallas-Fort Worth, Houston and San Antonio, which are among the fastest growing U.S. population centers with highly educated workforces, high household incomes and strong job growth. As of December 31, 2018, Whitestone's total shareholder return ranks #2 of 17, #1 of 17, and #2 of 16, of the U.S. public shopping center REITs for the one-year, three-year, and five-year periods, respectively.

About Ladder Capital

Ladder Capital Corp operates as a real estate investment trust in the United States. The company operates through three segments: Loans, Securities, and Real Estate. The Loans segment originates conduit first mortgage loans that are secured by cash-flowing commercial real estate; and originates and invests in balance sheet first mortgage loans secured by commercial real estate properties that are undergoing transition, including lease-up, sell-out, and renovation or repositioning. It also invests in note purchase financings, subordinated debt, mezzanine debt, and other structured finance products related to commercial real estate. The Securities segment invests in commercial mortgage-backed securities and the U.S. Agency Securities. This segment also invests in corporate bonds and real estate related equity investments. The Real Estate segment owns and invests in a portfolio of commercial and residential real estate properties, such as leased properties, student housing portfolio, industrial buildings, office buildings, shopping center, and condominium units. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. Ladder Capital Corp was founded in 2008 and is headquartered in New York, New York.

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