Comparing Ladder Capital (NYSE:LADR) & Federal Realty Investment Trust (NYSE:FRT)

Ladder Capital (NYSE:LADR) and Federal Realty Investment Trust (NYSE:FRT) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, risk, profitability, valuation, dividends, institutional ownership and analyst recommendations.

Dividends

Ladder Capital pays an annual dividend of $0.92 per share and has a dividend yield of 8.0%. Federal Realty Investment Trust pays an annual dividend of $4.40 per share and has a dividend yield of 4.6%. Ladder Capital pays out 107.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Federal Realty Investment Trust pays out 128.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Federal Realty Investment Trust has raised its dividend for 58 consecutive years. Ladder Capital is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares Ladder Capital and Federal Realty Investment Trust”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ladder Capital	$277.48 million	5.24	$108.25 million	$0.86	13.29
Federal Realty Investment Trust	$1.20 billion	6.77	$295.21 million	$3.43	27.71

Federal Realty Investment Trust has higher revenue and earnings than Ladder Capital. Ladder Capital 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.

Profitability

This table compares Ladder Capital and Federal Realty Investment Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ladder Capital	21.36%	8.77%	2.61%
Federal Realty Investment Trust	24.38%	9.89%	3.48%

Insider and Institutional Ownership

62.3% of Ladder Capital shares are owned by institutional investors. Comparatively, 93.9% of Federal Realty Investment Trust shares are owned by institutional investors. 12.0% of Ladder Capital shares are owned by company insiders. Comparatively, 1.0% of Federal Realty Investment Trust shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Ladder Capital and Federal Realty Investment Trust, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ladder Capital	0	1	4	1	3.00
Federal Realty Investment Trust	0	3	10	0	2.77

Ladder Capital presently has a consensus price target of $13.29, indicating a potential upside of 16.26%. Federal Realty Investment Trust has a consensus price target of $119.77, indicating a potential upside of 26.03%. Given Federal Realty Investment Trust’s higher probable upside, analysts plainly believe Federal Realty Investment Trust is more favorable than Ladder Capital.

Volatility & Risk

Ladder Capital has a beta of 1.91, indicating that its stock price is 91% more volatile than the S&P 500. Comparatively, Federal Realty Investment Trust has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500.

Summary

Federal Realty Investment Trust beats Ladder Capital on 12 of the 18 factors compared between the two stocks.

About Ladder Capital

Ladder Capital Corp operates as an internally-managed real estate investment trust in the United States. It operates through three segments: Loans, Securities, and Real Estate. The Loans segment originates conduit first mortgage loans that are secured by cash-flowing commercial real estate; and originates and invests in balance sheet first mortgage loans secured by commercial real estate properties that are undergoing transition, including lease-up, sell-out, and renovation or repositioning. It also invests in note purchase financings, subordinated debt, mezzanine debt, and other structured finance products related to commercial real estate. The Securities segment invests in commercial mortgage-backed securities, U.S. treasury and agency, corporate bonds, and equity securities. The Real Estate segment owns and invests in a portfolio of commercial and residential real estate properties, such as leased properties, office buildings, student housing portfolios, hotels, industrial buildings, shopping center, and condominium units. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was founded in 2008 and is headquartered in New York, New York.

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.