Universal Health Realty Income Trust (NYSE: UHT) and HCP (NYSE:HCP) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, profitability, risk, analyst recommendations, dividends and institutional ownership.
This table compares Universal Health Realty Income Trust and HCP’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Universal Health Realty Income Trust||61.38%||8.12%||3.32%|
Volatility and Risk
Universal Health Realty Income Trust has a beta of 0.36, indicating that its share price is 64% less volatile than the S&P 500. Comparatively, HCP has a beta of 0.37, indicating that its share price is 63% less volatile than the S&P 500.
Universal Health Realty Income Trust pays an annual dividend of $2.64 per share and has a dividend yield of 3.6%. HCP pays an annual dividend of $1.48 per share and has a dividend yield of 5.7%. Universal Health Realty Income Trust pays out 81.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. HCP pays out 102.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. HCP has increased its dividend for 31 consecutive years. HCP is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings and Valuation
This table compares Universal Health Realty Income Trust and HCP’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Universal Health Realty Income Trust||$74.03 million||13.46||$51.20 million||$3.24||22.60|
|HCP||$2.02 billion||6.00||$1.17 billion||$1.45||17.82|
HCP has higher revenue and earnings than Universal Health Realty Income Trust. HCP is trading at a lower price-to-earnings ratio than Universal Health Realty Income Trust, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
59.6% of Universal Health Realty Income Trust shares are owned by institutional investors. Comparatively, 89.7% of HCP shares are owned by institutional investors. 1.9% of Universal Health Realty Income Trust shares are owned by insiders. Comparatively, 0.2% of HCP shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
This is a summary of current recommendations for Universal Health Realty Income Trust and HCP, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Universal Health Realty Income Trust||0||0||0||0||N/A|
HCP has a consensus price target of $31.50, indicating a potential upside of 21.90%. Given HCP’s higher possible upside, analysts plainly believe HCP is more favorable than Universal Health Realty Income Trust.
HCP beats Universal Health Realty Income Trust on 10 of the 16 factors compared between the two stocks.
About Universal Health Realty Income Trust
Universal Health Realty Income Trust is a real estate investment trust (REIT). The Company invests in healthcare and human service related facilities, including acute care hospitals, rehabilitation hospitals, sub-acute facilities, surgery centers, free-standing emergency departments, childcare centers and medical office buildings (MOBs). As of February 28, 2017, the Company had 67 real estate investments located in 20 states in the United States consisting of six hospital facilities, including three acute care, one rehabilitation and two sub-acute; 54 MOBs; three free-standing emergency departments (FEDs), and four preschool and childcare centers. The Company’s facilities include Southwest Healthcare System, Inland Valley Campus, Wellington Regional Medical Center, Kindred Hospital Chicago Central, Vibra Hospital of Corpus Christi, Chesterbrook Academy, and Desert Valley Medical Center.
HCP, Inc. is a self-administered real estate investment trust. The Company invests in real estate serving the healthcare industry in the United States. The Company’s segments include senior housing triple-net (SH NNN), senior housing operating portfolio (SHOP), life science and medical office. Its senior housing facilities include independent living facilities, assisted living facilities, memory care facilities, care homes, and continuing care retirement communities. Its Life science properties contain laboratory and office space for biotechnology, medical device and pharmaceutical companies, scientific research institutions, government agencies and other organizations. Its Medical office buildings contain physicians’ offices and examination rooms, and may include pharmacies, hospital ancillary service space and outpatient services. As of December 31, 2016, it had interests in and managed 15 hospitals, 61 care homes in the United Kingdom and five post-acute/skilled nursing facilities.
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