Financial Analysis: Tanger (NYSE:SKT) versus CTO Realty Growth (NYSE:CTO)

Tanger (NYSE:SKT) and CTO Realty Growth (NYSE:CTO) are both real estate companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.

Profitability

This table compares Tanger and CTO Realty Growth’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tanger	20.74%	17.72%	4.62%
CTO Realty Growth	32.63%	8.90%	4.05%

Risk & Volatility

Tanger has a beta of 1.1, indicating that its share price is 10% more volatile than the S&P 500. Comparatively, CTO Realty Growth has a beta of 0.6, indicating that its share price is 40% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Tanger and CTO Realty Growth, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tanger	1	7	2	0	2.10
CTO Realty Growth	0	0	5	2	3.29

Tanger currently has a consensus price target of $40.30, suggesting a potential upside of 4.80%. CTO Realty Growth has a consensus price target of $24.50, suggesting a potential upside of 11.46%. Given CTO Realty Growth’s stronger consensus rating and higher probable upside, analysts clearly believe CTO Realty Growth is more favorable than Tanger.

Dividends

Tanger pays an annual dividend of $1.25 per share and has a dividend yield of 3.3%. CTO Realty Growth pays an annual dividend of $1.52 per share and has a dividend yield of 6.9%. Tanger pays out 113.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CTO Realty Growth pays out 111.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Tanger has increased its dividend for 4 consecutive years. CTO Realty Growth is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

85.2% of Tanger shares are held by institutional investors. Comparatively, 67.2% of CTO Realty Growth shares are held by institutional investors. 3.2% of Tanger shares are held by insiders. Comparatively, 4.5% of CTO Realty Growth shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Tanger and CTO Realty Growth”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tanger	$581.56 million	7.60	$114.78 million	$1.10	34.96
CTO Realty Growth	$149.54 million	5.51	$10.09 million	$1.36	16.16

Tanger has higher revenue and earnings than CTO Realty Growth. CTO Realty Growth is trading at a lower price-to-earnings ratio than Tanger, indicating that it is currently the more affordable of the two stocks.

About Tanger

Tanger Inc. (NYSE: SKT) is a leading owner and operator of outlet and open-air retail shopping destinations, with over 43 years of expertise in the retail and outlet shopping industries. Tanger’s portfolio of 38 outlet centers, one adjacent managed center and one open-air lifestyle center comprises over 15 million square feet well positioned across tourist destinations and vibrant markets in 20 U.S. states and Canada. A publicly traded REIT since 1993, Tanger continues to innovate the retail experience for its shoppers with over 3,000 stores operated by more than 700 different brand name companies. Tanger is furnishing a Form 8-K with the Securities and Exchange Commission (“SEC”) that includes a supplemental information package for the quarter and year ended December 31, 2023.

About CTO Realty Growth

CTO Realty Growth, Inc. is a publicly traded real estate investment trust that owns and operates a portfolio of high-quality, retail-based properties located primarily in higher growth markets in the United States. CTO also externally manages and owns a meaningful interest in Alpine Income Property Trust, Inc. (NYSE: PINE), a publicly traded net lease REIT.