Comparing Centerspace (NYSE:CSR) and Alexandria Real Estate Equities (NYSE:ARE)

Alexandria Real Estate Equities (NYSE:ARE) and Centerspace (NYSE:CSR) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, earnings, valuation, profitability, risk and dividends.

Analyst Ratings

This is a breakdown of current ratings and price targets for Alexandria Real Estate Equities and Centerspace, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alexandria Real Estate Equities	0	1	7	0	2.88
Centerspace	0	4	2	0	2.33

Alexandria Real Estate Equities currently has a consensus price target of $136.75, suggesting a potential upside of 13.48%. Centerspace has a consensus price target of $66.17, suggesting a potential downside of 3.70%. Given Alexandria Real Estate Equities’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Alexandria Real Estate Equities is more favorable than Centerspace.

Profitability

This table compares Alexandria Real Estate Equities and Centerspace’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alexandria Real Estate Equities	6.65%	0.87%	0.53%
Centerspace	-2.38%	-0.73%	-0.32%

Insider & Institutional Ownership

96.5% of Alexandria Real Estate Equities shares are held by institutional investors. Comparatively, 79.0% of Centerspace shares are held by institutional investors. 1.2% of Alexandria Real Estate Equities shares are held by company insiders. Comparatively, 0.9% of Centerspace shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Alexandria Real Estate Equities and Centerspace’s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alexandria Real Estate Equities	$2.89 billion	7.30	$103.64 million	$1.07	112.63
Centerspace	$257.92 million	3.97	$41.97 million	($0.80)	-85.89

Alexandria Real Estate Equities has higher revenue and earnings than Centerspace. Centerspace is trading at a lower price-to-earnings ratio than Alexandria Real Estate Equities, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Alexandria Real Estate Equities has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500. Comparatively, Centerspace has a beta of 0.87, meaning that its stock price is 13% less volatile than the S&P 500.

Dividends

Alexandria Real Estate Equities pays an annual dividend of $5.08 per share and has a dividend yield of 4.2%. Centerspace pays an annual dividend of $3.00 per share and has a dividend yield of 4.4%. Alexandria Real Estate Equities pays out 474.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Centerspace pays out -375.0% of its earnings in the form of a dividend. Alexandria Real Estate Equities has raised its dividend for 14 consecutive years and Centerspace has raised its dividend for 1 consecutive years. Centerspace is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Alexandria Real Estate Equities beats Centerspace on 15 of the 17 factors compared between the two stocks.

About Alexandria Real Estate Equities

Alexandria Real Estate Equities, Inc. (NYSE: ARE), an S&P 500 company, is a best-in-class, mission-driven life science REIT making a positive and lasting impact on the world. As the pioneer of the life science real estate niche since our founding in 1994, Alexandria is the preeminent and longest-tenured owner, operator, and developer of collaborative life science, agtech, and advanced technology mega campuses in AAA innovation cluster locations, including Greater Boston, the San Francisco Bay Area, New York City, San Diego, Seattle, Maryland, and Research Triangle. Alexandria has a total market capitalization of $33.1 billion and an asset base in North America of 73.5 million SF as of December 31, 2023, which includes 42.0 million RSF of operating properties, 5.5 million RSF of Class A/A+ properties undergoing construction and one near-term project expected to commence construction in the next two years, 2.1 million RSF of priority anticipated development and redevelopment projects, and 23.9 million SF of future development projects. Alexandria has a longstanding and proven track record of developing Class A/A+ properties clustered in life science, agtech, and advanced technology mega campuses that provide our innovative tenants with highly dynamic and collaborative environments that enhance their ability to successfully recruit and retain world-class talent and inspire productivity, efficiency, creativity, and success. Alexandria also provides strategic capital to transformative life science, agrifoodtech, climate innovation, and technology companies through our venture capital platform. We believe our unique business model and diligent underwriting ensure a high-quality and diverse tenant base that results in higher occupancy levels, longer lease terms, higher rental income, higher returns, and greater long-term asset value.

About Centerspace

Centerspace is an owner and operator of apartment communities committed to providing great homes by focusing on integrity and serving others. Founded in 1970, as of September 30, 2023, Centerspace owned interests in 71 apartment communities consisting of 12,785 apartment homes located in Colorado, Minnesota, Montana, Nebraska, North Dakota, and South Dakota. Centerspace was named a Top Workplace for the fourth consecutive year in 2023 by the Minneapolis Star Tribune.