Financial Contrast: Highwoods Properties (NYSE:HIW) and Tanger (NYSE:SKT)

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

Valuation and Earnings

This table compares Highwoods Properties and Tanger”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Highwoods Properties	$827.20 million	4.33	$148.71 million	$1.34	25.22
Tanger	$512.81 million	7.58	$99.15 million	$0.86	41.34

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

Insider and Institutional Ownership

96.3% of Highwoods Properties shares are owned by institutional investors. Comparatively, 85.2% of Tanger shares are owned by institutional investors. 1.6% of Highwoods Properties shares are owned by company insiders. Comparatively, 5.8% of Tanger shares are owned by company 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.

Analyst Ratings

This is a summary of current recommendations and price targets for Highwoods Properties and Tanger, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Highwoods Properties	1	4	1	0	2.00
Tanger	0	3	3	0	2.50

Highwoods Properties currently has a consensus target price of $29.33, suggesting a potential downside of 13.19%. Tanger has a consensus target price of $32.67, suggesting a potential downside of 8.11%. Given Tanger’s stronger consensus rating and higher possible upside, analysts clearly believe Tanger is more favorable than Highwoods Properties.

Dividends

Highwoods Properties pays an annual dividend of $2.00 per share and has a dividend yield of 5.9%. Tanger pays an annual dividend of $1.10 per share and has a dividend yield of 3.1%. Highwoods Properties pays out 149.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Tanger pays out 127.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Highwoods Properties	17.40%	6.05%	2.40%
Tanger	18.55%	16.32%	4.12%

Risk & Volatility

Highwoods Properties has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500. Comparatively, Tanger has a beta of 1.88, indicating that its share price is 88% more volatile than the S&P 500.

Summary

Tanger beats Highwoods Properties 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 Tanger

Tanger Inc. (NYSE: SKT) is a leading owner and operator of outlet and open-air retail shopping destinations, with over 43 years of expertise in the retail and outlet shopping industries. Tanger’s portfolio of 38 outlet centers, one adjacent managed center and one open-air lifestyle center comprises over 15 million square feet well positioned across tourist destinations and vibrant markets in 20 U.S. states and Canada. A publicly traded REIT since 1993, Tanger continues to innovate the retail experience for its shoppers with over 3,000 stores operated by more than 700 different brand name companies. Tanger is furnishing a Form 8-K with the Securities and Exchange Commission (“SEC”) that includes a supplemental information package for the quarter and year ended December 31, 2023.