Physicians Realty Trust (NYSE:DOC) vs. ANNALY CAP MGMT/SH (NYSE:NLY) Critical Contrast

Physicians Realty Trust (NYSE:DOC) and ANNALY CAP MGMT/SH (NYSE:NLY) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, valuation, earnings, profitability, analyst recommendations, dividends and risk.

Profitability

This table compares Physicians Realty Trust and ANNALY CAP MGMT/SH’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Physicians Realty Trust 10.61% 1.79% 1.05%
ANNALY CAP MGMT/SH -188.46% 11.66% 1.28%

Dividends

Physicians Realty Trust pays an annual dividend of $0.92 per share and has a dividend yield of 5.0%. ANNALY CAP MGMT/SH pays an annual dividend of $1.20 per share and has a dividend yield of 13.2%. Physicians Realty Trust pays out 85.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. ANNALY CAP MGMT/SH pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Physicians Realty Trust and ANNALY CAP MGMT/SH, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Physicians Realty Trust 0 6 1 0 2.14
ANNALY CAP MGMT/SH 0 1 5 0 2.83

Physicians Realty Trust presently has a consensus target price of $18.04, suggesting a potential downside of 1.58%. ANNALY CAP MGMT/SH has a consensus target price of $10.08, suggesting a potential upside of 11.17%. Given ANNALY CAP MGMT/SH’s stronger consensus rating and higher probable upside, analysts clearly believe ANNALY CAP MGMT/SH is more favorable than Physicians Realty Trust.

Insider and Institutional Ownership

93.6% of Physicians Realty Trust shares are owned by institutional investors. Comparatively, 54.3% of ANNALY CAP MGMT/SH shares are owned by institutional investors. 0.6% of Physicians Realty Trust shares are owned by company insiders. Comparatively, 0.3% of ANNALY CAP MGMT/SH shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Risk and Volatility

Physicians Realty Trust has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500. Comparatively, ANNALY CAP MGMT/SH has a beta of 0.39, indicating that its share price is 61% less volatile than the S&P 500.

Valuation and Earnings

This table compares Physicians Realty Trust and ANNALY CAP MGMT/SH’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Physicians Realty Trust $422.55 million 8.04 $56.23 million $1.08 16.97
ANNALY CAP MGMT/SH $1.43 billion 9.04 $54.40 million $1.20 7.56

Physicians Realty Trust has higher earnings, but lower revenue than ANNALY CAP MGMT/SH. ANNALY CAP MGMT/SH is trading at a lower price-to-earnings ratio than Physicians Realty Trust, indicating that it is currently the more affordable of the two stocks.

Summary

ANNALY CAP MGMT/SH beats Physicians Realty Trust on 9 of the 16 factors compared between the two stocks.

Physicians Realty Trust Company Profile

Physicians Realty Trust is a self-managed healthcare real estate company organized to acquire, selectively develop, own and manage healthcare properties that are leased to physicians, hospitals and healthcare delivery systems. The Company invests in real estate that is integral to providing high quality healthcare. The Company conducts its business through an UPREIT structure in which its properties are owned by Physicians Realty L.P., a Delaware limited partnership (the “operating partnership”), directly or through limited partnerships, limited liability companies or other subsidiaries. The Company is the sole general partner of the operating partnership and, as of March 31, 2019, owned approximately 97.3% of OP units.

ANNALY CAP MGMT/SH Company Profile

Annaly Capital Management, Inc., a diversified capital manager, invests in and finances residential and commercial assets. The company invests in various types of agency mortgage-backed securities, non-agency residential mortgage assets, and residential mortgage loans; and originates and invests in commercial mortgage loans, securities, and other commercial real estate investments. It also provides financing to private equity-backed middle market businesses; and operates as a broker-dealer. The company has elected to be taxed as a real estate investment trust (REIT). As a REIT, it is not subject to federal income tax to the extent that it distributes its taxable income to its shareholders. Annaly Capital Management, Inc. was founded in 1996 and is based in New York, New York.

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