Contrasting Forestar Group (NYSE:FOR) and Mitsubishi Estate (OTCMKTS:MITEY)

Mitsubishi Estate (OTCMKTS:MITEY) and Forestar Group (NYSE:FOR) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, institutional ownership, risk, analyst recommendations and valuation.

Valuation and Earnings

This table compares Mitsubishi Estate and Forestar Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mitsubishi Estate	$10.37 billion	2.83	$1.27 billion	$1.05	22.98
Forestar Group	$1.66 billion	0.77	$167.90 million	$3.29	7.67

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

Volatility & Risk

Mitsubishi Estate has a beta of 0.09, meaning that its share price is 91% less volatile than the S&P 500. Comparatively, Forestar Group has a beta of 1.41, meaning that its share price is 41% more volatile than the S&P 500.

Profitability

This table compares Mitsubishi Estate and Forestar Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mitsubishi Estate	11.67%	5.47%	1.84%
Forestar Group	10.11%	10.08%	5.52%

Analyst Recommendations

This is a summary of recent ratings and target prices for Mitsubishi Estate and Forestar Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mitsubishi Estate	0	0	0	1	4.00
Forestar Group	0	3	4	0	2.57

Forestar Group has a consensus target price of $32.00, suggesting a potential upside of 26.78%. Given Forestar Group’s higher probable upside, analysts plainly believe Forestar Group is more favorable than Mitsubishi Estate.

Institutional & Insider Ownership

35.5% of Forestar Group shares are held by institutional investors. 0.4% of Forestar Group shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Forestar Group beats Mitsubishi Estate on 8 of the 15 factors compared between the two stocks.

About Mitsubishi Estate

Mitsubishi Estate Co., Ltd. engages in the real estate activities in Japan and internationally. The company develops, leases, manages, and sells office buildings and commercial facilities; operates rental offices, coworking space, virtual offices, hourly meeting rooms, home delivery storage service, commercial nursing homes, and building garages; offers real estate management, as well as building management services, such as security, facility management, cleaning, and planting services; and operates hotels and airports. It also engages in the construction, sales, management, and leasing of developed condominiums and residential houses; design and contract construction of custom-built houses; renovation and sales of condominiums; real estate brokerage; dark fiber leasing and data center housing business; provision of real estate investment, such as asset management services to investment corporations and real estate funds; architectural design and engineering business; cooling and heating supply business; and parking management business. In addition, the company plans and operates logistics facilities; purchases, manufactures, processes, and sells construction materials; constructs prefabricated housing using cross-laminated timber and laminated wood; constructs, manufactures, and sells furniture and household items; offers financial consulting and investment advisory services; and develops and manages information systems and software. Further, it plans, develops, and operates GYYM, a platform service for fitness facilities; Ele-Cinema, a content distribution service that utilizes projectors in elevators; WELL ROOM, a healthcare portal site for foreign residents; and delivery and takeout systems. Additionally, the company produces and sells agricultural products; and offers walking tour entertainment content, human resources, land management, and landscaping services. Mitsubishi Estate Co., Ltd. was founded in 1890 and is headquartered in Tokyo, Japan.

About Forestar Group

Forestar Group Inc. operates as a residential lot development company in the United States. The company acquires land and develops infrastructure for single-family residential communities. It sells its residential single-family finished lots to local, regional, and national homebuilders. The company was incorporated in 2005 and is headquartered in Arlington, Texas. Forestar Group Inc. operates as a subsidiary of D.R. Horton, Inc.