PS Business Parks (PSB) and Duke Realty (DRE) Critical Survey
PS Business Parks (NYSE: DRE) and Duke Realty (NYSE:DRE) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, dividends, analyst recommendations, risk, profitability and earnings.
Risk & Volatility
PS Business Parks has a beta of 0.47, meaning that its share price is 53% less volatile than the S&P 500. Comparatively, Duke Realty has a beta of 0.58, meaning that its share price is 42% less volatile than the S&P 500.
This table compares PS Business Parks and Duke Realty’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|PS Business Parks||$402.18 million||8.84||$155.03 million||$6.13||21.22|
|Duke Realty||$780.93 million||13.15||$1.63 billion||$1.24||23.18|
Duke Realty has higher revenue and earnings than PS Business Parks. PS Business Parks is trading at a lower price-to-earnings ratio than Duke Realty, indicating that it is currently the more affordable of the two stocks.
PS Business Parks pays an annual dividend of $4.20 per share and has a dividend yield of 3.2%. Duke Realty pays an annual dividend of $0.80 per share and has a dividend yield of 2.8%. PS Business Parks pays out 68.5% of its earnings in the form of a dividend. Duke Realty pays out 64.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. PS Business Parks has raised its dividend for 4 consecutive years and Duke Realty has raised its dividend for 3 consecutive years. PS Business Parks is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares PS Business Parks and Duke Realty’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|PS Business Parks||54.22%||23.01%||10.66%|
Insider and Institutional Ownership
71.2% of PS Business Parks shares are held by institutional investors. Comparatively, 93.5% of Duke Realty shares are held by institutional investors. 1.6% of PS Business Parks shares are held by insiders. Comparatively, 0.2% of Duke Realty shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
This is a summary of recent ratings and target prices for PS Business Parks and Duke Realty, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|PS Business Parks||1||2||0||0||1.67|
PS Business Parks presently has a consensus target price of $120.00, suggesting a potential downside of 7.76%. Duke Realty has a consensus target price of $29.67, suggesting a potential upside of 3.22%. Given Duke Realty’s stronger consensus rating and higher probable upside, analysts clearly believe Duke Realty is more favorable than PS Business Parks.
Duke Realty beats PS Business Parks on 11 of the 17 factors compared between the two stocks.
PS Business Parks Company Profile
PS Business Parks, Inc., a member of the S&P SmallCap 600, is a real estate investment trust (?REIT?) that acquires, develops, owns and operates commercial properties, primarily multi-tenant industrial, flex and office space. As of June 30, 2018, the Company wholly owned 28.3 million rentable square feet with approximately 5,000 commercial customers in six states and a 95.0% interest in a 395-unit apartment complex.
Duke Realty Company Profile
Duke Realty Corporation owns and operates approximately 150 million rentable square feet of industrial assets in 20 major logistics markets. Duke Realty Corporation is publicly traded on the NYSE under the symbol DRE and is listed on the S&P 500 Index.
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