Comparing Retail Properties of America (RPAI) & The Competition

Retail Properties of America (NYSE: RPAI) is one of 32 public companies in the “Retail REITs” industry, but how does it contrast to its peers? We will compare Retail Properties of America to similar businesses based on the strength of its risk, institutional ownership, earnings, analyst recommendations, valuation, profitability and dividends.

Institutional and Insider Ownership

78.8% of Retail Properties of America shares are owned by institutional investors. Comparatively, 84.4% of shares of all “Retail REITs” companies are owned by institutional investors. 0.4% of Retail Properties of America shares are owned by company insiders. Comparatively, 8.9% of shares of all “Retail REITs” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Retail Properties of America and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Retail Properties of America 0 4 3 0 2.43
Retail Properties of America Competitors 145 1034 1132 21 2.44

Retail Properties of America currently has a consensus price target of $16.17, suggesting a potential upside of 25.62%. As a group, “Retail REITs” companies have a potential upside of 11.23%. Given Retail Properties of America’s higher possible upside, analysts plainly believe Retail Properties of America is more favorable than its peers.

Dividends

Retail Properties of America pays an annual dividend of $0.66 per share and has a dividend yield of 5.1%. Retail Properties of America pays out 103.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Retail REITs” companies pay a dividend yield of 4.3% and pay out 148.1% of their earnings in the form of a dividend. Retail Properties of America is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares Retail Properties of America and its peers revenue, earnings per share (EPS) and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
Retail Properties of America $583.14 million $166.81 million 20.11
Retail Properties of America Competitors $725.19 million $230.98 million 21.28

Retail Properties of America’s peers have higher revenue and earnings than Retail Properties of America. Retail Properties of America is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Retail Properties of America and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Retail Properties of America 28.84% 7.61% 3.71%
Retail Properties of America Competitors 20.46% 4.81% 2.64%

Risk & Volatility

Retail Properties of America has a beta of 0.48, indicating that its share price is 52% less volatile than the S&P 500. Comparatively, Retail Properties of America’s peers have a beta of 0.66, indicating that their average share price is 34% less volatile than the S&P 500.

Summary

Retail Properties of America peers beat Retail Properties of America on 9 of the 15 factors compared.

Retail Properties of America Company Profile

Retail Properties of America, Inc. is a real estate investment trust (REIT). The Company owns and operates shopping centers located in the United States. As of December 31, 2016, it owned 156 retail operating properties representing 25,832,000 square feet of gross leasable area (GLA). Its retail operating portfolio includes neighborhood and community centers, power centers, and lifestyle centers and multi-tenant retail-focused mixed-use properties, as well as single-user retail properties. As of December 31, 2016, it had identified 10 target markets, including Dallas, Washington, District of Columbia/Baltimore, New York, Atlanta, Seattle, Chicago, Houston, San Antonio, Phoenix and Austin. Its properties include 23rd Street Plaza, Azalea Square I, Boulevard Plaza, Brown’s Lane, Cranberry Square, Denton Crossing, Dorman Center I & II, Edgemont Town Center, Edwards Multiplex, Green’s Corner, Home Depot Plaza, Lake Mary Pointe, Lincoln Park, University Town Center and Winchester Commons.

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