Critical Review: Clipper Realty (NYSE:CLPR) vs. NNN REIT (NYSE:NNN)

NNN REIT (NYSE:NNN) and Clipper Realty (NYSE:CLPR) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, profitability and risk.

Institutional & Insider Ownership

90.0% of NNN REIT shares are owned by institutional investors. Comparatively, 37.6% of Clipper Realty shares are owned by institutional investors. 0.9% of NNN REIT shares are owned by company insiders. Comparatively, 54.6% of Clipper Realty 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.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for NNN REIT and Clipper Realty, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NNN REIT	2	8	3	0	2.08
Clipper Realty	0	1	0	0	2.00

NNN REIT currently has a consensus target price of $45.65, suggesting a potential downside of 3.69%. Given NNN REIT’s stronger consensus rating and higher possible upside, equities analysts plainly believe NNN REIT is more favorable than Clipper Realty.

Dividends

NNN REIT pays an annual dividend of $2.40 per share and has a dividend yield of 5.1%. Clipper Realty pays an annual dividend of $0.38 per share and has a dividend yield of 13.3%. NNN REIT pays out 116.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Clipper Realty pays out -46.9% of its earnings in the form of a dividend. NNN REIT has raised its dividend for 35 consecutive years. Clipper Realty is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares NNN REIT and Clipper Realty”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NNN REIT	$926.21 million	9.74	$389.78 million	$2.06	23.01
Clipper Realty	$153.20 million	0.30	-$19.90 million	($0.81)	-3.52

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

Volatility & Risk

NNN REIT has a beta of 0.81, suggesting that its stock price is 19% less volatile than the S&P 500. Comparatively, Clipper Realty has a beta of 0.96, suggesting that its stock price is 4% less volatile than the S&P 500.

Profitability

This table compares NNN REIT and Clipper Realty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NNN REIT	41.38%	8.81%	4.14%
Clipper Realty	-7.10%	N/A	-0.87%

Summary

NNN REIT beats Clipper Realty on 13 of the 17 factors compared between the two stocks.

About NNN REIT

NNN REIT invests primarily in high-quality retail properties subject generally to long-term, net leases. As of December 31, 2023, the company owned 3,532 properties in 49 states with a gross leasable area of approximately 36.0 million square feet and a weighted average remaining lease term of 10.1 years. NNN is one of only three publicly traded REITs to have increased annual dividends for 34 or more consecutive years.

About Clipper Realty

Clipper Realty Inc. (NYSE: CLPR) is a self-administered and self-managed real estate company that acquires, owns, manages, operates, and repositions multifamily residential and commercial properties in the New York metropolitan area, with a portfolio in Manhattan and Brooklyn.