Federal Realty Investment Trust (NYSE:FRT) versus Kimco Realty (NYSE:KIM) Critical Review

Federal Realty Investment Trust (NYSE:FRT) and Kimco Realty (NYSE:KIM) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their risk, profitability, dividends, institutional ownership, valuation, earnings and analyst recommendations.

Dividends

Federal Realty Investment Trust pays an annual dividend of $4.40 per share and has a dividend yield of 4.8%. Kimco Realty pays an annual dividend of $1.00 per share and has a dividend yield of 4.8%. Federal Realty Investment Trust pays out 126.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Kimco Realty pays out 120.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Federal Realty Investment Trust has raised its dividend for 58 consecutive years and Kimco Realty has raised its dividend for 2 consecutive years. Federal Realty Investment Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Federal Realty Investment Trust has a beta of 1.14, meaning that its share price is 14% more volatile than the S&P 500. Comparatively, Kimco Realty has a beta of 1.31, meaning that its share price is 31% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Federal Realty Investment Trust and Kimco Realty, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Federal Realty Investment Trust	0	6	8	0	2.57
Kimco Realty	0	9	5	2	2.56

Federal Realty Investment Trust presently has a consensus target price of $111.2857, indicating a potential upside of 21.61%. Kimco Realty has a consensus target price of $24.5667, indicating a potential upside of 16.70%. Given Federal Realty Investment Trust’s stronger consensus rating and higher possible upside, equities analysts clearly believe Federal Realty Investment Trust is more favorable than Kimco Realty.

Earnings and Valuation

This table compares Federal Realty Investment Trust and Kimco Realty”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Federal Realty Investment Trust	$1.20 billion	6.53	$295.21 million	$3.49	26.22
Kimco Realty	$2.09 billion	6.80	$410.79 million	$0.83	25.36

Kimco Realty has higher revenue and earnings than Federal Realty Investment Trust. Kimco Realty is trading at a lower price-to-earnings ratio than Federal Realty Investment Trust, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

93.9% of Federal Realty Investment Trust shares are held by institutional investors. Comparatively, 89.3% of Kimco Realty shares are held by institutional investors. 1.0% of Federal Realty Investment Trust shares are held by insiders. Comparatively, 2.2% of Kimco Realty shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Federal Realty Investment Trust and Kimco Realty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Federal Realty Investment Trust	24.77%	9.97%	3.55%
Kimco Realty	28.54%	5.58%	2.99%

Summary

Federal Realty Investment Trust beats Kimco Realty on 10 of the 18 factors compared between the two stocks.

About Federal Realty Investment Trust

Federal Realty Investment Trust is an equity real estate investment trust, which engages in the provision of ownership, management, and redevelopment of retail and mixed-use properties located primarily in communities where demand exceeds supply in strategically selected metropolitan markets. The company was founded in 1962 and is headquartered in North Bethesda, MD.

About Kimco Realty

Kimco Realty Corp. is a real estate investment trust (REIT) headquartered in New Hyde Park, N.Y., that is one of North America’s largest publicly traded owners and operators of open-air shopping centers. As of December 31, 2018, the company owned interests in 437 U.S. shopping centers comprising 76 million square feet of leasable space primarily concentrated in the top major metropolitan markets.