Head-To-Head Analysis: Whitestone REIT (NYSE:WSR) vs. Innovative Industrial Properties (NYSE:IIPR)

Whitestone REIT (NYSE:WSR) and Innovative Industrial Properties (NYSE:IIPR) are both small-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Dividends

Whitestone REIT pays an annual dividend of $0.54 per share and has a dividend yield of 3.6%. Innovative Industrial Properties pays an annual dividend of $7.60 per share and has a dividend yield of 15.8%. Whitestone REIT pays out 63.5% of its earnings in the form of a dividend. Innovative Industrial Properties pays out 180.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Whitestone REIT has increased its dividend for 5 consecutive years and Innovative Industrial Properties has increased its dividend for 4 consecutive years.

Risk & Volatility

Whitestone REIT has a beta of 0.81, suggesting that its stock price is 19% less volatile than the S&P 500. Comparatively, Innovative Industrial Properties has a beta of 1.47, suggesting that its stock price is 47% more volatile than the S&P 500.

Institutional and Insider Ownership

69.5% of Whitestone REIT shares are owned by institutional investors. Comparatively, 70.6% of Innovative Industrial Properties shares are owned by institutional investors. 3.2% of Whitestone REIT shares are owned by company insiders. Comparatively, 2.0% of Innovative Industrial Properties shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Whitestone REIT and Innovative Industrial Properties”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Whitestone REIT	$154.28 million	4.95	$36.89 million	$0.85	17.62
Innovative Industrial Properties	$308.52 million	4.38	$161.66 million	$4.22	11.42

Innovative Industrial Properties has higher revenue and earnings than Whitestone REIT. Innovative Industrial Properties is trading at a lower price-to-earnings ratio than Whitestone REIT, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Whitestone REIT and Innovative Industrial Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Whitestone REIT	28.16%	10.10%	3.89%
Innovative Industrial Properties	45.80%	6.77%	5.40%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Whitestone REIT and Innovative Industrial Properties, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Whitestone REIT	0	0	5	1	3.17
Innovative Industrial Properties	3	2	1	0	1.67

Whitestone REIT presently has a consensus price target of $16.25, suggesting a potential upside of 8.51%. Innovative Industrial Properties has a consensus price target of $68.20, suggesting a potential upside of 41.46%. Given Innovative Industrial Properties’ higher probable upside, analysts plainly believe Innovative Industrial Properties is more favorable than Whitestone REIT.

About Whitestone REIT

Whitestone REIT (NYSE: WSR) is a community-centered real estate investment trust (REIT) that acquires, owns, operates, and develops open-air, retail centers located in some of the fastest growing markets in the country: Phoenix, Austin, Dallas-Fort Worth, Houston and San Antonio. Our centers are convenience focused: merchandised with a mix of service-oriented tenants providing food (restaurants and grocers), self-care (health and fitness), services (financial and logistics), education and entertainment to the surrounding communities. The Company believes its strong community connections and deep tenant relationships are key to the success of its current centers and its acquisition strategy.

About Innovative Industrial Properties

Innovative Industrial Properties, Inc. is a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized properties leased to experienced, state-licensed operators for their regulated cannabis facilities. Innovative Industrial Properties, Inc. has elected to be taxed as a real estate investment trust, commencing with the year ended December 31, 2017.