Taubman Centers (TCO) versus Retail Opportunity Investments Corp. (ROIC) Head-To-Head Survey

Taubman Centers (NYSE: TCO) and Retail Opportunity Investments Corp. (NASDAQ:ROIC) are both mid-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, earnings, profitability, risk and dividends.

Analyst Recommendations

This is a summary of recent ratings and target prices for Taubman Centers and Retail Opportunity Investments Corp., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Taubman Centers 2 6 2 0 2.00
Retail Opportunity Investments Corp. 0 4 3 0 2.43

Taubman Centers presently has a consensus price target of $66.17, indicating a potential upside of 24.58%. Retail Opportunity Investments Corp. has a consensus price target of $22.17, indicating a potential upside of 16.61%. Given Taubman Centers’ higher possible upside, equities research analysts plainly believe Taubman Centers is more favorable than Retail Opportunity Investments Corp..

Dividends

Taubman Centers pays an annual dividend of $2.50 per share and has a dividend yield of 4.7%. Retail Opportunity Investments Corp. pays an annual dividend of $0.75 per share and has a dividend yield of 3.9%. Taubman Centers pays out 238.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Retail Opportunity Investments Corp. pays out 220.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Taubman Centers has raised its dividend for 7 consecutive years. Taubman Centers is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Taubman Centers and Retail Opportunity Investments Corp.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Taubman Centers 13.21% -75.87% 2.03%
Retail Opportunity Investments Corp. 14.13% 2.86% 1.34%

Risk and Volatility

Taubman Centers has a beta of 0.52, suggesting that its stock price is 48% less volatile than the S&P 500. Comparatively, Retail Opportunity Investments Corp. has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500.

Insider & Institutional Ownership

94.9% of Retail Opportunity Investments Corp. shares are held by institutional investors. 31.2% of Taubman Centers shares are held by company insiders. Comparatively, 2.2% of Retail Opportunity Investments Corp. shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Taubman Centers and Retail Opportunity Investments Corp.’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Taubman Centers $612.56 million 5.26 $132.61 million $1.05 50.58
Retail Opportunity Investments Corp. $237.19 million 8.79 $32.48 million $0.34 55.91

Taubman Centers has higher revenue and earnings than Retail Opportunity Investments Corp.. Taubman Centers is trading at a lower price-to-earnings ratio than Retail Opportunity Investments Corp., indicating that it is currently the more affordable of the two stocks.

Summary

Retail Opportunity Investments Corp. beats Taubman Centers on 9 of the 17 factors compared between the two stocks.

Taubman Centers Company Profile

Taubman Centers, Inc. is a self-administered and self-managed real estate investment trust (REIT). The Company’s segment is focused on owning, developing and managing regional shopping centers. The Taubman Realty Group Limited Partnership (the Operating Partnership or TRG) is majority-owned partnership subsidiary of the Company that owns direct or indirect interests in all of its real estate properties. The Company owns, leases, acquires, disposes of, develops, expands and manages regional and super-regional shopping centers and interests therein. Its owned portfolio of operating centers as of December 31, 2016 consisted of 23 urban and suburban shopping centers operating in 11 the United States states, Puerto Rico, South Korea, and China. The consolidated businesses consist of shopping centers and entities that are controlled by ownership or contractual agreements, The Taubman Company LLC (Manager), and Taubman Properties Asia LLC and its subsidiaries (Taubman Asia).

Retail Opportunity Investments Corp. Company Profile

Retail Opportunity Investments Corp. (ROIC) is a fully integrated, self-managed real estate investment trust (REIT). The Company specializes in the acquisition, ownership and management of necessity-based community and neighborhood shopping centers on the west coast of the United States, anchored by supermarkets and drugstores. Retail Opportunity Investments Partnership, LP is the operating partnership of the Company. The Operating Partnership holds substantially all the assets of the Company and directly or indirectly holds the ownership interests in the Company’s real estate ventures. The Operating Partnership conducts the operations of the Company’s business. As of December 31, 2016, the Company’s portfolio consisted of 82 properties (81 retail and one office) totaling approximately 9.4 million square feet of gross leasable area (GLA). As of December 31, 2016, the Company’s portfolio was approximately 97.6% leased.

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