Reviewing Mackenzie Realty Capital (NASDAQ:MKZR) & JBG SMITH Properties (NYSE:JBGS)

JBG SMITH Properties (NYSE:JBGS) and Mackenzie Realty Capital (NASDAQ:MKZR) are both small-cap real estate companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, profitability, analyst recommendations, institutional ownership, earnings, risk and valuation.

Earnings & Valuation

This table compares JBG SMITH Properties and Mackenzie Realty Capital”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
JBG SMITH Properties	$498.60 million	1.41	-$139.06 million	($3.54)	-3.44
Mackenzie Realty Capital	$20.01 million	0.16	-$17.54 million	($9.53)	-0.12

Mackenzie Realty Capital has lower revenue, but higher earnings than JBG SMITH Properties. JBG SMITH Properties is trading at a lower price-to-earnings ratio than Mackenzie Realty Capital, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares JBG SMITH Properties and Mackenzie Realty Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
JBG SMITH Properties	-39.73%	-18.71%	-4.78%
Mackenzie Realty Capital	-82.40%	-19.33%	-6.91%

Dividends

JBG SMITH Properties pays an annual dividend of $0.70 per share and has a dividend yield of 5.7%. Mackenzie Realty Capital pays an annual dividend of $2.00 per share and has a dividend yield of 174.7%. JBG SMITH Properties pays out -19.8% of its earnings in the form of a dividend. Mackenzie Realty Capital pays out -21.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Mackenzie Realty Capital is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for JBG SMITH Properties and Mackenzie Realty Capital, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
JBG SMITH Properties	3	0	0	0	1.00
Mackenzie Realty Capital	1	0	0	0	1.00

JBG SMITH Properties currently has a consensus target price of $12.50, suggesting a potential upside of 2.50%. Given JBG SMITH Properties’ higher possible upside, analysts clearly believe JBG SMITH Properties is more favorable than Mackenzie Realty Capital.

Volatility and Risk

JBG SMITH Properties has a beta of 1.12, suggesting that its stock price is 12% more volatile than the S&P 500. Comparatively, Mackenzie Realty Capital has a beta of -0.37, suggesting that its stock price is 137% less volatile than the S&P 500.

Insider & Institutional Ownership

98.5% of JBG SMITH Properties shares are owned by institutional investors. 11.9% of JBG SMITH Properties shares are owned by company insiders. Comparatively, 9.0% of Mackenzie Realty Capital shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

JBG SMITH Properties beats Mackenzie Realty Capital on 10 of the 14 factors compared between the two stocks.

About JBG SMITH Properties

JBG SMITH Properties is a real estate investment trust that owns, operates and develops residential, office and retail properties. Its portfolio is concentrated in the Washington, D.C., metropolitan area, with a significant presence in National Landing, Virginia, as well as properties in the District and suburban Maryland. The company focuses on urban, mixed-use and transit-oriented communities, serving residents, businesses and retail tenants. Its activities include leasing and managing existing properties and developing projects intended to bring housing, workplaces and services together.

About Mackenzie Realty Capital

Mackenzie Realty Capital, Inc. is a real estate investment company that focuses on acquiring, owning and managing income-producing real estate assets. The company’s activities include evaluating real estate investment opportunities, developing a portfolio of properties and overseeing property operations with the goal of generating rental income and long-term value for shareholders. Publicly available information about Mackenzie Realty Capital’s specific property types, geographic focus and leadership is limited.