Financial Survey: City Office REIT (NYSE:CIO) vs. Community Healthcare Trust (NYSE:CHCT)

City Office REIT (NYSE:CIO) and Community Healthcare Trust (NYSE:CHCT) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, profitability, earnings, dividends, valuation, risk and institutional ownership.

Insider & Institutional Ownership

67.5% of City Office REIT shares are owned by institutional investors. Comparatively, 87.8% of Community Healthcare Trust shares are owned by institutional investors. 3.9% of City Office REIT shares are owned by company insiders. Comparatively, 4.0% of Community Healthcare Trust shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

City Office REIT has a beta of 1.91, meaning that its share price is 91% more volatile than the S&P 500. Comparatively, Community Healthcare Trust has a beta of 0.68, meaning that its share price is 32% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations for City Office REIT and Community Healthcare Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
City Office REIT	0	1	0	0	2.00
Community Healthcare Trust	0	3	1	0	2.25

Community Healthcare Trust has a consensus target price of $28.67, indicating a potential upside of 23.40%. Given Community Healthcare Trust’s stronger consensus rating and higher possible upside, analysts plainly believe Community Healthcare Trust is more favorable than City Office REIT.

Profitability

This table compares City Office REIT and Community Healthcare Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
City Office REIT	-2.24%	-0.60%	-0.26%
Community Healthcare Trust	15.91%	3.57%	1.93%

Dividends

City Office REIT pays an annual dividend of $0.40 per share and has a dividend yield of 7.9%. Community Healthcare Trust pays an annual dividend of $1.84 per share and has a dividend yield of 7.9%. City Office REIT pays out -142.9% of its earnings in the form of a dividend. Community Healthcare Trust pays out 287.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares City Office REIT and Community Healthcare Trust’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
City Office REIT	$179.10 million	1.13	-$2.68 million	($0.28)	-18.04
Community Healthcare Trust	$115.00 million	5.60	$7.71 million	$0.64	36.30

Community Healthcare Trust has lower revenue, but higher earnings than City Office REIT. City Office REIT is trading at a lower price-to-earnings ratio than Community Healthcare Trust, indicating that it is currently the more affordable of the two stocks.

Summary

Community Healthcare Trust beats City Office REIT on 13 of the 16 factors compared between the two stocks.

About City Office REIT

City Office REIT is an internally-managed real estate company focused on acquiring, owning and operating high-quality office properties located predominantly in Sun Belt markets. City Office currently owns or has a controlling interest in 5.7 million square feet of office properties. The Company has elected to be taxed as a real estate investment trust for U.S. federal income tax purposes.

About Community Healthcare Trust

Community Healthcare Trust Incorporated is a real estate investment trust that focuses on owning income-producing real estate properties associated primarily with the delivery of outpatient healthcare services in our target sub-markets throughout the United States. As of December 31, 2023, the Company had investments of approximately $1.1 billion in 193 real estate properties (including a portion of one property accounted for as a sales-type lease and two properties classified as held for sale). The properties are located in 34 states, totaling approximately 4.3 million square feet in the aggregate.