Reviewing Highwoods Properties (NYSE:HIW) & Brandywine Realty Trust (NYSE:BDN)

Brandywine Realty Trust (NYSE:BDN) and Highwoods Properties (NYSE:HIW) are both real estate companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, dividends, institutional ownership, risk, earnings, profitability and analyst recommendations.

Profitability

This table compares Brandywine Realty Trust and Highwoods Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Brandywine Realty Trust	-27.60%	-19.24%	-3.97%
Highwoods Properties	22.56%	7.68%	2.98%

Analyst Recommendations

This is a breakdown of current recommendations for Brandywine Realty Trust and Highwoods Properties, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Brandywine Realty Trust	3	3	0	0	1.50
Highwoods Properties	0	8	0	0	2.00

Brandywine Realty Trust currently has a consensus price target of $3.50, suggesting a potential upside of 7.53%. Highwoods Properties has a consensus price target of $32.00, suggesting a potential upside of 1.61%. Given Brandywine Realty Trust’s higher probable upside, analysts plainly believe Brandywine Realty Trust is more favorable than Highwoods Properties.

Dividends

Brandywine Realty Trust pays an annual dividend of $0.32 per share and has a dividend yield of 9.8%. Highwoods Properties pays an annual dividend of $2.00 per share and has a dividend yield of 6.4%. Brandywine Realty Trust pays out -40.0% of its earnings in the form of a dividend. Highwoods Properties pays out 118.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Brandywine Realty Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

87.3% of Brandywine Realty Trust shares are held by institutional investors. Comparatively, 96.3% of Highwoods Properties shares are held by institutional investors. 4.5% of Brandywine Realty Trust shares are held by insiders. Comparatively, 1.3% of Highwoods Properties shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Brandywine Realty Trust and Highwoods Properties”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Brandywine Realty Trust	$502.51 million	1.10	-$178.25 million	($0.80)	-4.07
Highwoods Properties	$806.11 million	4.31	$159.61 million	$1.69	18.64

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

Risk and Volatility

Brandywine Realty Trust has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500. Comparatively, Highwoods Properties has a beta of 1.08, indicating that its share price is 8% more volatile than the S&P 500.

Summary

Highwoods Properties beats Brandywine Realty Trust on 10 of the 15 factors compared between the two stocks.

About Brandywine Realty Trust

Brandywine Realty Trust (NYSE: BDN) is one of the largest, publicly traded, full-service, integrated real estate companies in the United States with a core focus in the Philadelphia and Austin markets. Organized as a real estate investment trust (REIT), we own, develop, lease and manage an urban, town center and transit-oriented portfolio comprising 160 properties and 22.6 million square feet as of September 30, 2023 which excludes assets held for sale. Our purpose is to shape, connect and inspire the world around us through our expertise, the relationships we foster, the communities in which we live and work, and the history we build together.

About Highwoods Properties

Highwoods Properties, Inc., headquartered in Raleigh, is a publicly-traded (NYSE:HIW), fully-integrated office real estate investment trust (REIT) that owns, develops, acquires, leases and manages properties primarily in the best business districts (BBDs) of Atlanta, Charlotte, Dallas, Nashville, Orlando, Raleigh, Richmond and Tampa. Highwoods is in the work-placemaking business. We believe that by creating environments and experiences where the best and brightest can achieve together what they cannot apart, we can deliver greater value to our customers, their teammates and, in turn, our stakeholders.