Head to Head Survey: Simon Property Group (NYSE:SPG) and Federal Realty Investment Trust (NYSE:FRT)

Federal Realty Investment Trust (NYSE:FRT) and Simon Property Group (NYSE:SPG) are both real estate companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, profitability, valuation and risk.

Volatility & Risk

Federal Realty Investment Trust has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500. Comparatively, Simon Property Group has a beta of 1.27, meaning that its share price is 27% more volatile than the S&P 500.

Earnings & Valuation

This table compares Federal Realty Investment Trust and Simon Property Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Federal Realty Investment Trust	$1.28 billion	7.49	$411.08 million	$5.00	22.28
Simon Property Group	$6.36 billion	11.29	$4.63 billion	$14.18	15.66

Simon Property Group has higher revenue and earnings than Federal Realty Investment Trust. Simon Property Group is trading at a lower price-to-earnings ratio than Federal Realty Investment Trust, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

93.9% of Federal Realty Investment Trust shares are held by institutional investors. Comparatively, 93.0% of Simon Property Group shares are held by institutional investors. 1.1% of Federal Realty Investment Trust shares are held by insiders. Comparatively, 8.7% of Simon Property Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Federal Realty Investment Trust and Simon Property Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Federal Realty Investment Trust	0	6	9	1	2.69
Simon Property Group	0	13	4	1	2.33

Federal Realty Investment Trust currently has a consensus target price of $124.88, indicating a potential upside of 12.11%. Simon Property Group has a consensus target price of $224.07, indicating a potential upside of 0.88%. Given Federal Realty Investment Trust’s stronger consensus rating and higher probable upside, research analysts plainly believe Federal Realty Investment Trust is more favorable than Simon Property Group.

Dividends

Federal Realty Investment Trust pays an annual dividend of $4.64 per share and has a dividend yield of 4.2%. Simon Property Group pays an annual dividend of $9.00 per share and has a dividend yield of 4.1%. Federal Realty Investment Trust pays out 92.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Simon Property Group pays out 63.5% of its earnings in the form of a dividend. Federal Realty Investment Trust has increased its dividend for 58 consecutive years and Simon Property Group has increased its dividend for 4 consecutive years. Federal Realty Investment Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Federal Realty Investment Trust and Simon Property Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Federal Realty Investment Trust	32.60%	13.76%	4.85%
Simon Property Group	66.56%	89.32%	12.03%

Summary

Simon Property Group beats Federal Realty Investment Trust on 11 of the 17 factors compared between the two stocks.

About Federal Realty Investment Trust

Federal Realty Investment Trust is an equity real estate investment trust, which engages in the provision of ownership, management, and redevelopment of retail and mixed-use properties located primarily in communities where demand exceeds supply in strategically selected metropolitan markets. The company was founded in 1962 and is headquartered in North Bethesda, MD.

About Simon Property Group

Simon Property Group, Inc. (NYSE:SPG) is a self-administered and self-managed real estate investment trust (REIT). Simon Property Group, L.P., or the Operating Partnership, is our majority-owned partnership subsidiary that owns all of our real estate properties and other assets. In this package, the terms Simon, we, our, or the Company refer to Simon Property Group, Inc., the Operating Partnership, and its subsidiaries. We own, develop and manage premier shopping, dining, entertainment and mixed-use destinations, which consist primarily of malls, Premium Outlets, The Mills, and International Properties. At June 30, 2024, we owned or had an interest in 230 properties comprising 183 million square feet in North America, Asia and Europe. We also owned an 84% interest in The Taubman Realty Group, or TRG, which owns 22 regional, super-regional, and outlet malls in the U.S. and Asia. Additionally, at June 30, 2024, we had a 22.4% ownership interest in Klépierre, a publicly traded, Paris-based real estate company, which owns shopping centers in 14 European countries.