Contrasting Paramount Group (PGRE) & Piedmont Office Realty Trust (PDM)
Paramount Group (NASDAQ: PGRE) and Piedmont Office Realty Trust (NYSE:PDM) are both mid-cap financials companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, dividends, earnings, valuation, institutional ownership, profitability and analyst recommendations.
This is a breakdown of recent recommendations and price targets for Paramount Group and Piedmont Office Realty Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Piedmont Office Realty Trust||0||1||1||0||2.50|
Paramount Group presently has a consensus price target of $16.10, indicating a potential upside of 0.63%. Piedmont Office Realty Trust has a consensus price target of $22.50, indicating a potential upside of 12.44%. Given Piedmont Office Realty Trust’s stronger consensus rating and higher probable upside, analysts plainly believe Piedmont Office Realty Trust is more favorable than Paramount Group.
Piedmont Office Realty Trust pays an annual dividend of $0.84 per share and has a dividend yield of 4.2%. Paramount Group does not pay a dividend. Piedmont Office Realty Trust pays out 221.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Piedmont Office Realty Trust has raised its dividend for 3 consecutive years.
This table compares Paramount Group and Piedmont Office Realty Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Piedmont Office Realty Trust||9.71%||2.67%||1.29%|
Earnings and Valuation
This table compares Paramount Group and Piedmont Office Realty Trust’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Paramount Group||$708.66 million||5.39||$384.89 million||N/A||N/A|
|Piedmont Office Realty Trust||$579.79 million||5.02||$263.29 million||$0.38||52.66|
Paramount Group has higher revenue and earnings than Piedmont Office Realty Trust.
Institutional and Insider Ownership
82.8% of Piedmont Office Realty Trust shares are held by institutional investors. 0.8% of Piedmont Office Realty Trust shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Paramount Group beats Piedmont Office Realty Trust on 9 of the 15 factors compared between the two stocks.
About Paramount Group
Paramount Group, Inc. is a fully-integrated real estate investment trust (REIT) focused on owning, operating, managing, acquiring and redeveloping Class A office properties in select central business district submarkets of New York City, Washington, District of Columbia (D.C.) and San Francisco. The Company conducts its business through, and substantially all its interests in properties and investments are held by, Paramount Group Operating Partnership LP (the Operating Partnership). The Company’s segments include New York, Washington, D.C. and San Francisco. As of December 31, 2016, the Company’s portfolio consisted of 13 Class A office properties aggregating approximately 10.8 million square feet that was 93.3% leased and 90.9% occupied. The Company also has an investment management business, where it serves as the general partner and property manager of certain private equity real estate funds for institutional investors and high-net-worth individuals.
About Piedmont Office Realty Trust
Piedmont Office Realty Trust, Inc. is an integrated self-managed real estate investment trust (REIT). The Company’s business consists primarily of owning, managing, operating, leasing, acquiring, developing, investing in, and disposing of office real estate assets. As of December 31, 2016, the Company owned and operated 65 in-service office properties, one redevelopment asset, two development assets and one office building through an unconsolidated joint venture. Its properties are located in areas, including New York, Chicago, Atlanta, Dallas, Boston, Minneapolis and Orlando. Its tenant base includes industries, such as business services, depository institutions, educational services, real estate, legal services and insurance carriers. The Company conducts business primarily through Piedmont Operating Partnership, L.P. (Piedmont OP). It performs the management of its buildings through its subsidiaries, including Piedmont Government Services, LLC and Piedmont Office Management, LLC.
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