Kimco Realty Corporation (KIM) and DDR Corp. (DDR) Financial Analysis
Kimco Realty Corporation (NYSE: KIM) and DDR Corp. (NYSE:DDR) are both mid-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, earnings, profitability, dividends, analyst recommendations and institutional ownership.
Kimco Realty Corporation pays an annual dividend of $1.08 per share and has a dividend yield of 5.6%. DDR Corp. pays an annual dividend of $0.76 per share and has a dividend yield of 8.2%. Kimco Realty Corporation pays out 220.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. DDR Corp. pays out -380.0% of its earnings in the form of a dividend. Kimco Realty Corporation has raised its dividend for 6 consecutive years and DDR Corp. has raised its dividend for 7 consecutive years. DDR Corp. is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Insider and Institutional Ownership
89.1% of Kimco Realty Corporation shares are held by institutional investors. Comparatively, 80.2% of DDR Corp. shares are held by institutional investors. 2.9% of Kimco Realty Corporation shares are held by company insiders. Comparatively, 16.1% of DDR Corp. shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares Kimco Realty Corporation and DDR Corp.’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Kimco Realty Corporation||$1.17 billion||6.98||$764.78 million||$0.49||39.14|
|DDR Corp.||$963.85 million||3.54||$622.40 million||($0.20)||-46.45|
Kimco Realty Corporation has higher revenue and earnings than DDR Corp.. DDR Corp. is trading at a lower price-to-earnings ratio than Kimco Realty Corporation, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations and price targets for Kimco Realty Corporation and DDR Corp., as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Kimco Realty Corporation||0||8||6||0||2.43|
Kimco Realty Corporation currently has a consensus price target of $25.32, indicating a potential upside of 32.01%. DDR Corp. has a consensus price target of $13.50, indicating a potential upside of 45.32%. Given DDR Corp.’s higher possible upside, analysts plainly believe DDR Corp. is more favorable than Kimco Realty Corporation.
Risk and Volatility
Kimco Realty Corporation has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500. Comparatively, DDR Corp. has a beta of 0.8, meaning that its stock price is 20% less volatile than the S&P 500.
This table compares Kimco Realty Corporation and DDR Corp.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Kimco Realty Corporation||21.77%||4.68%||2.23%|
Kimco Realty Corporation beats DDR Corp. on 10 of the 16 factors compared between the two stocks.
Kimco Realty Corporation Company Profile
Kimco Realty Corporation is a self-administered real estate investment trust. The Company is engaged in the ownership, management, development and operation of open-air shopping centers, which are anchored generally by discount department stores, grocery stores or drugstores. As of June 30, 2017, the Company had interests in 510 shopping center properties, including 84 million square feet of gross leasable area (GLA), located in 32 states, Puerto Rico and Canada. As of March 31, 2017, the Company had 380 other property interests, primarily through the Company’s preferred equity investments and other real estate investments, totaling 5.8 million square feet of GLA.
DDR Corp. Company Profile
DDR Corp. is a self-administered and self-managed real estate investment trust. It operates through two segments: shopping centers and loan investments. It is in the business of acquiring, owning, developing, redeveloping, expanding, leasing and managing shopping centers. As of December 31, 2016, it owned and managed approximately 106 million total square feet of gross leasable area (GLA). As of December 31, 2016, the portfolio properties included 319 shopping centers (including 152 centers owned through joint ventures). As of December 31, 2016, the portfolio properties also included over 650 acres of undeveloped land, including parcels located adjacent to certain of the shopping centers. As of December 31, 2016, the portfolio properties aggregated to 75.8 million square feet of Company-owned GLA located in 35 states, plus Puerto Rico. These centers are in the Southeast and Midwest, with significant concentrations in Florida, Georgia, Ohio and North Carolina, as well as Puerto Rico.
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