Analyzing First Industrial Realty Trust (FR) & DCT Industrial Trust (DCT)
First Industrial Realty Trust (NYSE: FR) and DCT Industrial Trust (NYSE:DCT) are both mid-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, earnings, institutional ownership, risk, profitabiliy and valuation.
Risk and Volatility
First Industrial Realty Trust has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.Comparatively, DCT Industrial Trust has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500.
Earnings and Valuation
This table compares First Industrial Realty Trust and DCT Industrial Trust’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|First Industrial Realty Trust||$386.50 million||9.30||$254.02 million||$0.98||30.61|
|DCT Industrial Trust||$408.95 million||12.54||$278.55 million||$0.99||56.30|
DCT Industrial Trust has higher revenue and earnings than First Industrial Realty Trust. First Industrial Realty Trust is trading at a lower price-to-earnings ratio than DCT Industrial Trust, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
91.8% of First Industrial Realty Trust shares are owned by institutional investors. Comparatively, 96.7% of DCT Industrial Trust shares are owned by institutional investors. 1.8% of First Industrial Realty Trust shares are owned by company insiders. Comparatively, 1.5% of DCT Industrial Trust shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
This is a breakdown of current recommendations and price targets for First Industrial Realty Trust and DCT Industrial Trust, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|First Industrial Realty Trust||0||3||1||0||2.25|
|DCT Industrial Trust||0||5||2||0||2.29|
First Industrial Realty Trust currently has a consensus target price of $29.75, indicating a potential downside of 0.83%. DCT Industrial Trust has a consensus target price of $51.33, indicating a potential downside of 7.91%. Given First Industrial Realty Trust’s higher possible upside, equities research analysts clearly believe First Industrial Realty Trust is more favorable than DCT Industrial Trust.
This table compares First Industrial Realty Trust and DCT Industrial Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|First Industrial Realty Trust||29.91%||8.88%||4.12%|
|DCT Industrial Trust||22.20%||4.69%||2.43%|
First Industrial Realty Trust pays an annual dividend of $0.84 per share and has a dividend yield of 2.8%. DCT Industrial Trust pays an annual dividend of $1.24 per share and has a dividend yield of 2.2%. First Industrial Realty Trust pays out 85.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. DCT Industrial Trust pays out 125.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. First Industrial Realty Trust has increased its dividend for 2 consecutive years and DCT Industrial Trust has increased its dividend for 3 consecutive years. First Industrial Realty Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.
DCT Industrial Trust beats First Industrial Realty Trust on 9 of the 17 factors compared between the two stocks.
About First Industrial Realty Trust
First Industrial Realty Trust, Inc. is a real estate investment trust (REIT). The Trust is a self-administered real estate company, which owns, manages, acquires, sells, develops and redevelops industrial real estate. As of December 31, 2016, the Company’s in-service portfolio consisted of 215 light industrial properties, 53 research and development (R&D)/flex properties, 167 bulk warehouse properties and 100 regional warehouse properties containing an aggregate of approximately 62.2 million square feet of gross leasable area (GLA) located in 23 states. The Company’s in-service portfolio includes all properties that have reached stabilized occupancy, developed and redeveloped properties and acquired properties that are occupied at acquisition or one year from the acquisition date. The Company’s operations are conducted primarily through the First Industrial, L.P. (the Operating Partnership), of which the Company is the sole general partner.
About DCT Industrial Trust
DCT Industrial Trust Inc. (DCT) is an industrial real estate company. The Company specializes in the ownership, acquisition, development, leasing and management of bulk-distribution and light-industrial properties located in various distribution markets in the United States. The Company operates through three segments: East, Central and West. As of December 31, 2016, the Company owned interests in approximately 74.0 million square feet of properties leased to various customers, including 64.7 million square feet consisting of 401 consolidated operating properties that were 97.2% occupied; 7.8 million square feet consisting of 23 unconsolidated properties that were 97.8% occupied; 0.3 million square feet consisting of three consolidated properties under redevelopment, and 1.2 million square feet consisting of four consolidated properties. As of December 31, 2016, the Company’s total consolidated portfolio consisted of 408 properties with an average size of 162,000 square feet.
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