Comparing Alexandria Real Estate Equities (NYSE:ARE) & Highlands REIT (OTCMKTS:HHDS)

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

Valuation and Earnings

This table compares Alexandria Real Estate Equities and Highlands REIT”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alexandria Real Estate Equities	$3.03 billion	2.79	-$1.43 billion	($6.27)	-7.73
Highlands REIT	$37.41 million	0.87	-$11.10 million	($0.01)	-4.52

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

Institutional & Insider Ownership

96.5% of Alexandria Real Estate Equities shares are held by institutional investors. Comparatively, 0.0% of Highlands REIT shares are held by institutional investors. 1.4% of Alexandria Real Estate Equities shares are held by company insiders. Comparatively, 2.3% of Highlands REIT 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.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Alexandria Real Estate Equities	-36.03%	-5.21%	-2.96%
Highlands REIT	-30.49%	-5.91%	-3.53%

Volatility and Risk

Alexandria Real Estate Equities has a beta of 1.12, indicating that its stock price is 12% more volatile than the S&P 500. Comparatively, Highlands REIT has a beta of 22.15, indicating that its stock price is 2,115% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations for Alexandria Real Estate Equities and Highlands REIT, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alexandria Real Estate Equities	2	11	3	0	2.06
Highlands REIT	0	0	0	0	0.00

Alexandria Real Estate Equities presently has a consensus target price of $51.23, suggesting a potential upside of 5.76%. Given Alexandria Real Estate Equities’ stronger consensus rating and higher probable upside, analysts clearly believe Alexandria Real Estate Equities is more favorable than Highlands REIT.

Summary

Alexandria Real Estate Equities beats Highlands REIT on 8 of the 14 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 Highlands REIT

We are a self-advised and self-administered real estate investment trust (REIT) created to own and manage substantially all of the non-core investment properties previously owned and managed by our former parent, InvenTrust Properties Corp., a Maryland corporation (InvenTrust). On April 28, 2016, we were spun-off from InvenTrust through a pro rata distribution (the Distribution) by InvenTrust of 100% of the outstanding shares of our common stock to holders of InvenTrust's common stock. Prior to or concurrent with the separation, we and InvenTrust engaged in certain reorganization transactions that were designed to consolidate substantially all of InvenTrust's remaining non-core investment properties in Highlands.