Head-To-Head Review: Highwoods Properties (NYSE:HIW) and Centerspace (NYSE:CSR)

Highwoods Properties (NYSE:HIW) and Centerspace (NYSE:CSR) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, institutional ownership, profitability, valuation, analyst recommendations, risk and dividends.

Dividends

Highwoods Properties pays an annual dividend of $2.00 per share and has a dividend yield of 7.5%. Centerspace pays an annual dividend of $3.00 per share and has a dividend yield of 4.4%. Highwoods Properties pays out 163.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Centerspace pays out -375.0% of its earnings in the form of a dividend.

Profitability

This table compares Highwoods Properties and Centerspace’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Highwoods Properties	15.78%	5.44%	2.18%
Centerspace	-2.38%	-0.73%	-0.32%

Earnings and Valuation

This table compares Highwoods Properties and Centerspace’s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Highwoods Properties	$832.52 million	3.38	$148.71 million	$1.22	21.76
Centerspace	$261.31 million	3.87	$41.97 million	($0.80)	-84.86

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

Insider & Institutional Ownership

96.3% of Highwoods Properties shares are held by institutional investors. Comparatively, 79.0% of Centerspace shares are held by institutional investors. 1.8% of Highwoods Properties shares are held by insiders. Comparatively, 0.9% of Centerspace shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Volatility and Risk

Highwoods Properties has a beta of 1.27, indicating that its share price is 27% more volatile than the S&P 500. Comparatively, Centerspace has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings for Highwoods Properties and Centerspace, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Highwoods Properties	1	5	2	0	2.13
Centerspace	0	3	3	0	2.50

Highwoods Properties currently has a consensus target price of $24.75, suggesting a potential downside of 6.78%. Centerspace has a consensus target price of $67.57, suggesting a potential downside of 0.47%. Given Centerspace’s stronger consensus rating and higher probable upside, analysts clearly believe Centerspace is more favorable than Highwoods Properties.

Summary

Highwoods Properties beats Centerspace on 11 of the 16 factors compared between the two stocks.

About Highwoods Properties

Highwoods Properties, Inc., headquartered in Raleigh, is a publicly-traded (NYSE:HIW), fully-integrated office real estate investment trust (REIT) that owns, develops, acquires, leases and manages properties primarily in the best business districts (BBDs) of Atlanta, Charlotte, Dallas, Nashville, Orlando, Raleigh, Richmond and Tampa. Highwoods is in the work-placemaking business. We believe that by creating environments and experiences where the best and brightest can achieve together what they cannot apart, we can deliver greater value to our customers, their teammates and, in turn, our stakeholders.

About Centerspace

Centerspace is an owner and operator of apartment communities committed to providing great homes by focusing on integrity and serving others. Founded in 1970, as of September 30, 2023, Centerspace owned interests in 71 apartment communities consisting of 12,785 apartment homes located in Colorado, Minnesota, Montana, Nebraska, North Dakota, and South Dakota. Centerspace was named a Top Workplace for the fourth consecutive year in 2023 by the Minneapolis Star Tribune.