Head-To-Head Comparison: Tejon Ranch (NYSE:TRC) and Office Properties Income Trust (NYSE:OPI)

Tejon Ranch (NYSE:TRC) and Office Properties Income Trust (NASDAQ:OPI) are both small-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, risk, dividends, institutional ownership, analyst recommendations, earnings and valuation.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Tejon Ranch and Office Properties Income Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tejon Ranch 0 0 0 0 N/A
Office Properties Income Trust 1 3 0 0 1.75

Office Properties Income Trust has a consensus target price of $28.25, indicating a potential downside of 18.04%. Given Office Properties Income Trust’s higher possible upside, analysts clearly believe Office Properties Income Trust is more favorable than Tejon Ranch.

Valuation & Earnings

This table compares Tejon Ranch and Office Properties Income Trust’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Tejon Ranch $45.62 million 9.38 $4.26 million N/A N/A
Office Properties Income Trust $426.56 million 3.90 -$21.88 million $7.95 4.34

Tejon Ranch has higher earnings, but lower revenue than Office Properties Income Trust.

Profitability

This table compares Tejon Ranch and Office Properties Income Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tejon Ranch 2.88% 0.27% 0.22%
Office Properties Income Trust -14.86% -4.29% -1.54%

Volatility & Risk

Tejon Ranch has a beta of 0.89, indicating that its share price is 11% less volatile than the S&P 500. Comparatively, Office Properties Income Trust has a beta of 1.69, indicating that its share price is 69% more volatile than the S&P 500.

Insider and Institutional Ownership

70.6% of Tejon Ranch shares are owned by institutional investors. Comparatively, 71.3% of Office Properties Income Trust shares are owned by institutional investors. 19.8% of Tejon Ranch shares are owned by insiders. Comparatively, 1.7% of Office Properties Income Trust shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Tejon Ranch beats Office Properties Income Trust on 7 of the 11 factors compared between the two stocks.

Tejon Ranch Company Profile

Tejon Ranch Co. operates as a diversified real estate development and agribusiness company. It operates through five segments: Commercial/Industrial Real Estate Development, Resort/Residential Real Estate Development, Mineral Resources, Farming, and Ranch Operations. The Commercial/Industrial Real Estate Development segment engages in the entitling, planning, and permitting of land for development; construction of infrastructure; construction of pre-leased buildings, and buildings to be leased or sold; and sale of land to third parties for their own development. It is also involved in the activities related to communications leases, and landscape maintenance. This segment leases land to 2 auto service stations with convenience stores, 13 fast-food operations, 2 full-service restaurants, a motel, an antique shop, and a post office; various microwave repeater locations, radio and cellular transmitter sites, and fiber optic cable routes; and 32 acres of land for an electric power plant. The Resort/Residential Real Estate Development segment engages in the land entitlement, land planning and pre-construction engineering, land stewardship, and conservation activities. The Mineral Resources segment includes oil and gas royalties, rock and aggregate royalties, and royalties from a cement operation leased to National Cement Company of California, Inc.; and the management of water assets and water infrastructure. The Farming segment farms permanent crops, including wine grapes in 1,197 acres, almonds in 1,966 acres, and pistachios in 1,062 acres. It also manages the farming of alfalfa and forage mix on 775 acres in the Antelope Valley; and leases 1,000 acres of land for growing vegetables, as well as permanent crops. The Ranch Operations segment offers game management and ancillary land services comprising grazing leases and filming, as well as various guided hunts. The company was founded in 1843 and is headquartered in Lebec, California.

Office Properties Income Trust Company Profile

Office Properties Income Trust is a real estate investment trust, or REIT, which owns buildings primarily leased to single tenants and those with high credit quality characteristics like government entities. In December 2018, our predecessor company Government Properties Income Trust, or GOV, merged with Select Income REIT, or SIR, and the combined company was renamed Office Properties Income Trust, or OPI. Combining the two companies creates a national office REIT with increased scale, enhanced tenant and geographic diversification, a well-laddered lease expiration schedule, a broader investment strategy, and a company with one of the highest percentages of rent paid by investment grade rated tenants in the office sector.

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