One Liberty Properties (NYSE:OLP) and Gladstone Land (NASDAQ:LAND) Critical Survey

Gladstone Land (NASDAQ:LAND) and One Liberty Properties (NYSE:OLP) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, institutional ownership, valuation and dividends.

Insider and Institutional Ownership

53.6% of Gladstone Land shares are owned by institutional investors. Comparatively, 36.2% of One Liberty Properties shares are owned by institutional investors. 6.1% of Gladstone Land shares are owned by insiders. Comparatively, 25.8% of One Liberty Properties shares are owned by 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.

Analyst Ratings

This is a breakdown of recent ratings for Gladstone Land and One Liberty Properties, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gladstone Land	1	2	0	1	2.25
One Liberty Properties	1	0	1	1	2.67

Gladstone Land presently has a consensus price target of $10.00, suggesting a potential upside of 17.37%. One Liberty Properties has a consensus price target of $28.50, suggesting a potential upside of 13.33%. Given Gladstone Land’s higher possible upside, research analysts clearly believe Gladstone Land is more favorable than One Liberty Properties.

Valuation and Earnings

This table compares Gladstone Land and One Liberty Properties”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gladstone Land	$88.09 million	4.17	$13.53 million	($0.61)	-13.97
One Liberty Properties	$101.35 million	5.41	$25.47 million	$1.27	19.80

One Liberty Properties has higher revenue and earnings than Gladstone Land. Gladstone Land is trading at a lower price-to-earnings ratio than One Liberty Properties, indicating that it is currently the more affordable of the two stocks.

Dividends

Gladstone Land pays an annual dividend of $0.56 per share and has a dividend yield of 6.6%. One Liberty Properties pays an annual dividend of $1.80 per share and has a dividend yield of 7.2%. Gladstone Land pays out -91.8% of its earnings in the form of a dividend. One Liberty Properties pays out 141.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Gladstone Land has raised its dividend for 2 consecutive years.

Profitability

This table compares Gladstone Land and One Liberty Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gladstone Land	-6.68%	-0.87%	-0.48%
One Liberty Properties	27.19%	9.13%	3.29%

Risk and Volatility

Gladstone Land has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500. Comparatively, One Liberty Properties has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500.

Summary

One Liberty Properties beats Gladstone Land on 12 of the 17 factors compared between the two stocks.

About Gladstone Land

Founded in 1997, Gladstone Land is a publicly traded real estate investment trust that acquires and owns farmland and farm-related properties located in major agricultural markets in the U.S. and leases its properties to unrelated third-party farmers. The Company, which reports the aggregate fair value of its farmland holdings on a quarterly basis, currently owns 169 farms, comprised of approximately 116,000 acres in 15 different states and over 45,000 acre-feet of banked water in California, valued at a total of approximately $1.6 billion. Gladstone Land’s farms are predominantly located in regions where its tenants are able to grow fresh produce annual row crops, such as berries and vegetables, which are generally planted and harvested annually. The Company also owns farms growing permanent crops, such as almonds, apples, cherries, figs, lemons, olives, pistachios, and other orchards, as well as blueberry groves and vineyards, which are generally planted every 20-plus years and harvested annually. Approximately 40% of the Company’s fresh produce acreage is either organic or in transition to become organic, and over 10% of its permanent crop acreage falls into this category. The Company may also acquire property related to farming, such as cooling facilities, processing buildings, packaging facilities, and distribution centers. Gladstone Land pays monthly distributions to its stockholders and has paid 129 consecutive monthly cash distributions on its common stock since its initial public offering in January 2013. The Company has increased its common distributions 32 times over the prior 35 quarters, and the current per-share distribution on its common stock is $0.0464 per month, or $0.5568 per year.

About One Liberty Properties

One Liberty Properties, Inc. is a real estate investment trust, which engages in acquisition, ownership, and management of the geographically diversified portfolio consisting primarily of industrial, retail, restaurant, health and fitness, and theater properties, many of which are subject to long-term leases. The properties in the firm’s portfolio include net leases, long-term lease, and scheduled rent increases. The company was founded in December 1982 and is headquartered in Great Neck, NY.