Analyzing Healthcare Realty Trust (NYSE:HR) & Highwoods Properties (NYSE:HIW)

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Healthcare Realty Trust and Highwoods Properties, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Healthcare Realty Trust	1	4	2	0	2.14
Highwoods Properties	1	5	1	0	2.00

Healthcare Realty Trust currently has a consensus price target of $17.14, indicating a potential downside of 1.87%. Highwoods Properties has a consensus price target of $27.86, indicating a potential downside of 15.20%. Given Healthcare Realty Trust’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Healthcare Realty Trust is more favorable than Highwoods Properties.

Earnings & Valuation

This table compares Healthcare Realty Trust and Highwoods Properties”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Healthcare Realty Trust	$1.32 billion	5.03	-$278.26 million	($1.33)	-13.14
Highwoods Properties	$829.97 million	4.20	$148.71 million	$1.22	26.93

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

Profitability

This table compares Healthcare Realty Trust and Highwoods Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Healthcare Realty Trust	-42.79%	-8.50%	-4.52%
Highwoods Properties	18.30%	6.33%	2.53%

Risk and Volatility

Healthcare Realty Trust has a beta of 0.91, suggesting that its stock price is 9% less volatile than the S&P 500. Comparatively, Highwoods Properties has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500.

Insider and Institutional Ownership

96.3% of Highwoods Properties shares are owned by institutional investors. 0.6% of Healthcare Realty Trust shares are owned by company insiders. Comparatively, 1.6% of Highwoods Properties shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Healthcare Realty Trust pays an annual dividend of $1.24 per share and has a dividend yield of 7.1%. Highwoods Properties pays an annual dividend of $2.00 per share and has a dividend yield of 6.1%. Healthcare Realty Trust pays out -93.2% of its earnings in the form of a dividend. Highwoods Properties pays out 163.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Healthcare Realty Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Highwoods Properties beats Healthcare Realty Trust on 9 of the 16 factors compared between the two stocks.

About Healthcare Realty Trust

Healthcare Realty (NYSE: HR) is a real estate investment trust (REIT) that owns and operates medical outpatient buildings primarily located around market-leading hospital campuses. The Company selectively grows its portfolio through property acquisition and development. As the first and largest REIT to specialize in medical outpatient buildings, Healthcare Realty's portfolio includes more than 700 properties totaling over 40 million square feet concentrated in 15 growth markets.

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.