Critical Contrast: Lamar Advertising (NASDAQ:LAMR) vs. Empire State Realty Trust (NYSE:ESRT)

Lamar Advertising (NASDAQ:LAMR) and Empire State Realty Trust (NYSE:ESRT) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, earnings, valuation, profitability, dividends, institutional ownership and analyst recommendations.

Earnings & Valuation

This table compares Lamar Advertising and Empire State Realty Trust”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lamar Advertising	$2.16 billion	6.42	$495.76 million	$4.87	27.87
Empire State Realty Trust	$763.20 million	2.35	$53.24 million	$0.30	36.22

Lamar Advertising has higher revenue and earnings than Empire State Realty Trust. Lamar Advertising is trading at a lower price-to-earnings ratio than Empire State Realty Trust, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Lamar Advertising and Empire State Realty Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lamar Advertising	23.34%	42.18%	7.69%
Empire State Realty Trust	5.89%	2.57%	1.06%

Institutional & Insider Ownership

93.8% of Lamar Advertising shares are held by institutional investors. Comparatively, 67.1% of Empire State Realty Trust shares are held by institutional investors. 15.0% of Lamar Advertising shares are held by insiders. Comparatively, 14.0% of Empire State Realty Trust shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Volatility & Risk

Lamar Advertising has a beta of 1.52, suggesting that its share price is 52% more volatile than the S&P 500. Comparatively, Empire State Realty Trust has a beta of 1.4, suggesting that its share price is 40% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Lamar Advertising and Empire State Realty Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lamar Advertising	0	4	1	0	2.20
Empire State Realty Trust	1	1	1	0	2.00

Lamar Advertising currently has a consensus target price of $125.00, suggesting a potential downside of 7.92%. Empire State Realty Trust has a consensus target price of $10.33, suggesting a potential downside of 4.89%. Given Empire State Realty Trust’s higher probable upside, analysts plainly believe Empire State Realty Trust is more favorable than Lamar Advertising.

Dividends

Lamar Advertising pays an annual dividend of $5.60 per share and has a dividend yield of 4.1%. Empire State Realty Trust pays an annual dividend of $0.14 per share and has a dividend yield of 1.3%. Lamar Advertising pays out 115.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Empire State Realty Trust pays out 46.7% of its earnings in the form of a dividend.

Summary

Lamar Advertising beats Empire State Realty Trust on 12 of the 15 factors compared between the two stocks.

About Lamar Advertising

Lamar Advertising Company operates as an outdoor advertising company in the United States and Canada. The company owns and operates billboards, logo signs, and transit advertising displays, as well as rents space for advertising on billboards, buses, shelters, benches, logo plates, and in airport terminals. Lamar Advertising Company was founded in 1902 and is headquartered in Baton Rouge, Louisiana.

About Empire State Realty Trust

Empire State Realty Trust, Inc. (NYSE: ESRT) is a NYC-focused REIT that owns and operates a portfolio of modernized, amenitized, and well-located office, retail, and multifamily assets. The company is the recognized leader in energy efficiency and indoor environmental quality. ESRT’s flagship Empire State Building – the “World’s Most Famous Building” – includes its Observatory, Tripadvisor’s 2023 Travelers’ Choice Awards: Best of the Best the #1 attraction in the US for two consecutive years. As of September 30, 2023, ESRT’s portfolio is comprised of approximately 8.6 million rentable square feet of office space, 0.7 million rentable square feet of retail space and 727 residential units across three multifamily properties.