Terreno Realty (NYSE:TRNO) versus RLJ Lodging Trust (NYSE:RLJ) Financial Contrast

RLJ Lodging Trust (NYSE:RLJ) and Terreno Realty (NYSE:TRNO) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, earnings, valuation, risk, profitability and dividends.

Volatility and Risk

RLJ Lodging Trust has a beta of 1.13, meaning that its share price is 13% more volatile than the S&P 500. Comparatively, Terreno Realty has a beta of 1.13, meaning that its share price is 13% more volatile than the S&P 500.

Profitability

This table compares RLJ Lodging Trust and Terreno Realty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RLJ Lodging Trust	2.48%	1.78%	0.69%
Terreno Realty	72.41%	8.27%	6.41%

Dividends

RLJ Lodging Trust pays an annual dividend of $0.60 per share and has a dividend yield of 7.8%. Terreno Realty pays an annual dividend of $2.08 per share and has a dividend yield of 3.5%. RLJ Lodging Trust pays out 1,200.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Terreno Realty pays out 66.0% of its earnings in the form of a dividend. RLJ Lodging Trust has raised its dividend for 3 consecutive years and Terreno Realty has raised its dividend for 5 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings and target prices for RLJ Lodging Trust and Terreno Realty, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RLJ Lodging Trust	4	3	2	1	2.00
Terreno Realty	1	5	8	1	2.60

RLJ Lodging Trust presently has a consensus price target of $8.64, indicating a potential upside of 12.90%. Terreno Realty has a consensus price target of $65.43, indicating a potential upside of 9.33%. Given RLJ Lodging Trust’s higher probable upside, equities analysts plainly believe RLJ Lodging Trust is more favorable than Terreno Realty.

Earnings & Valuation

This table compares RLJ Lodging Trust and Terreno Realty”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RLJ Lodging Trust	$1.37 billion	0.84	$68.02 million	$0.05	153.10
Terreno Realty	$382.62 million	16.17	$184.50 million	$3.15	19.00

Terreno Realty has lower revenue, but higher earnings than RLJ Lodging Trust. Terreno Realty is trading at a lower price-to-earnings ratio than RLJ Lodging Trust, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

92.4% of RLJ Lodging Trust shares are held by institutional investors. 2.9% of RLJ Lodging Trust shares are held by company insiders. Comparatively, 2.0% of Terreno Realty shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

Terreno Realty beats RLJ Lodging Trust on 10 of the 16 factors compared between the two stocks.

About RLJ Lodging Trust

RLJ Lodging Trust is a self-advised, publicly traded real estate investment trust that owns primarily premium-branded, high-margin, focused-service and compact full-service hotels. The Company's portfolio currently consists of 96 hotels with approximately 21,200 rooms, located in 23 states and the District of Columbia and an ownership interest in one unconsolidated hotel with 171 rooms.

About Terreno Realty

Terreno Realty Corporation (Terreno, and together with its subsidiaries, the Company) acquires, owns and operates industrial real estate in six major coastal U.S. markets: Los Angeles, Northern New Jersey/New York City, San Francisco Bay Area, Seattle, Miami, and Washington, D.C. All square feet, acres, occupancy and number of properties disclosed in these notes to the consolidated financial statements are unaudited. As of December 31, 2023, the Company owned 259 buildings aggregating approximately 16.0 million square feet, 45 improved land parcels consisting of approximately 152.4 acres, seven properties under development or redevelopment and approximately 62.7 acres of land entitled for future development. The Company is an internally managed Maryland corporation and elected to be taxed as a real estate investment trust (REIT) under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the Code), commencing with its taxable year ended December 31, 2010.