Head to Head Review: Retail Properties of America (NYSE:RPAI) vs. Outfront Media (NYSE:OUT)

Retail Properties of America (NYSE:RPAI) and Outfront Media (NYSE:OUT) are both mid-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, profitability, analyst recommendations, institutional ownership, dividends, valuation and earnings.

Earnings and Valuation

This table compares Retail Properties of America and Outfront Media’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Retail Properties of America $482.50 million 6.08 $77.64 million $1.03 13.34
Outfront Media $1.61 billion 2.23 $107.90 million $2.15 11.64

Outfront Media has higher revenue and earnings than Retail Properties of America. Outfront Media is trading at a lower price-to-earnings ratio than Retail Properties of America, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Retail Properties of America has a beta of 0.52, suggesting that its stock price is 48% less volatile than the S&P 500. Comparatively, Outfront Media has a beta of 1.06, suggesting that its stock price is 6% more volatile than the S&P 500.

Dividends

Retail Properties of America pays an annual dividend of $0.66 per share and has a dividend yield of 4.8%. Outfront Media pays an annual dividend of $1.44 per share and has a dividend yield of 5.8%. Retail Properties of America pays out 64.1% of its earnings in the form of a dividend. Outfront Media pays out 67.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Profitability

This table compares Retail Properties of America and Outfront Media’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Retail Properties of America 5.91% 2.17% 1.02%
Outfront Media 8.72% 13.54% 3.06%

Analyst Recommendations

This is a breakdown of recent recommendations for Retail Properties of America and Outfront Media, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Retail Properties of America 0 1 2 0 2.67
Outfront Media 0 2 5 0 2.71

Retail Properties of America presently has a consensus target price of $14.00, suggesting a potential upside of 1.89%. Outfront Media has a consensus target price of $27.26, suggesting a potential upside of 8.95%. Given Outfront Media’s stronger consensus rating and higher possible upside, analysts plainly believe Outfront Media is more favorable than Retail Properties of America.

Insider and Institutional Ownership

81.8% of Retail Properties of America shares are held by institutional investors. Comparatively, 95.1% of Outfront Media shares are held by institutional investors. 0.6% of Retail Properties of America shares are held by company insiders. Comparatively, 0.7% of Outfront Media shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Outfront Media beats Retail Properties of America on 13 of the 16 factors compared between the two stocks.

About Retail Properties of America

Retail Properties of America, Inc. is a REIT that owns and operates high quality, strategically located open-air shopping centers, including properties with a mixed-use component. As of December 31, 2018, the Company owned 105 retail operating properties in the United States representing 20.1 million square feet. The Company is publicly traded on the New York Stock Exchange under the ticker symbol RPAI.

About Outfront Media

OUTFRONT leverages the power of technology, location and creativity to connect brands with consumers outside of their homes through one of the largest and most diverse sets of billboard, transit, and mobile assets in North America. Through its ON Smart Media platform, OUTFRONT is implementing digital technology that will fundamentally change the ways advertisers engage audiences on-the-go.

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