Reviewing Equity LifeStyle Properties (NYSE:ELS) and Diversified Healthcare Trust (NASDAQ:DHC)

Equity LifeStyle Properties (NYSE:ELS) and Diversified Healthcare Trust (NASDAQ:DHC) are both real estate companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, institutional ownership, valuation and profitability.

Dividends

Equity LifeStyle Properties pays an annual dividend of $1.91 per share and has a dividend yield of 2.8%. Diversified Healthcare Trust pays an annual dividend of $0.04 per share and has a dividend yield of 1.1%. Equity LifeStyle Properties pays out 104.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Diversified Healthcare Trust pays out -2.7% of its earnings in the form of a dividend. Equity LifeStyle Properties has increased its dividend for 20 consecutive years. Equity LifeStyle Properties is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Equity LifeStyle Properties has a beta of 0.79, indicating that its share price is 21% less volatile than the S&P 500. Comparatively, Diversified Healthcare Trust has a beta of 2.22, indicating that its share price is 122% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for Equity LifeStyle Properties and Diversified Healthcare Trust, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Equity LifeStyle Properties	0	5	4	1	2.60
Diversified Healthcare Trust	1	1	1	0	2.00

Equity LifeStyle Properties currently has a consensus target price of $72.44, indicating a potential upside of 5.45%. Diversified Healthcare Trust has a consensus target price of $4.50, indicating a potential upside of 28.57%. Given Diversified Healthcare Trust’s higher possible upside, analysts plainly believe Diversified Healthcare Trust is more favorable than Equity LifeStyle Properties.

Profitability

This table compares Equity LifeStyle Properties and Diversified Healthcare Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Equity LifeStyle Properties	23.56%	23.71%	6.34%
Diversified Healthcare Trust	-24.14%	-15.36%	-6.51%

Institutional and Insider Ownership

97.2% of Equity LifeStyle Properties shares are held by institutional investors. Comparatively, 76.0% of Diversified Healthcare Trust shares are held by institutional investors. 1.4% of Equity LifeStyle Properties shares are held by insiders. Comparatively, 1.4% of Diversified Healthcare Trust shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Equity LifeStyle Properties and Diversified Healthcare Trust”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Equity LifeStyle Properties	$1.43 billion	8.96	$314.21 million	$1.83	37.54
Diversified Healthcare Trust	$1.41 billion	0.60	-$293.57 million	($1.48)	-2.36

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

Summary

Equity LifeStyle Properties beats Diversified Healthcare Trust on 15 of the 18 factors compared between the two stocks.

About Equity LifeStyle Properties

We are a self-administered, self-managed real estate investment trust (REIT) with headquarters in Chicago. As of January 29, 2024, we own or have an interest in 451 properties in 35 states and British Columbia consisting of 172,465 sites.

About Diversified Healthcare Trust

DHC is a real estate investment trust, or REIT, focused on owning high-quality healthcare properties located throughout the United States. DHC seeks diversification across the health services spectrum by care delivery and practice type, by scientific research disciplines and by property type and location. As of December 31, 2023, DHC's approximately $7.2 billion portfolio included 371 properties in 36 states and Washington, D.C., occupied by approximately 500 tenants, and totaling approximately 8.6 million square feet of life science and medical office properties and more than 27,000 senior living units. DHC is managed by The RMR Group (Nasdaq: RMR), a leading U.S. alternative asset management company with over $41 billion in assets under management as of December 31, 2023 and more than 35 years of institutional experience in buying, selling, financing and operating commercial real estate. DHC is headquartered in Newton, MA.