Reviewing Centerspace (NYSE:CSR) and Armada Hoffler Properties (NYSE:AHH)

Centerspace (NYSE:CSR) and Armada Hoffler Properties (NYSE:AHH) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, institutional ownership, valuation and profitability.

Volatility & Risk

Centerspace has a beta of 0.73, indicating that its share price is 27% less volatile than the S&P 500. Comparatively, Armada Hoffler Properties has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500.

Profitability

This table compares Centerspace and Armada Hoffler Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Centerspace	-9.13%	-2.81%	-1.27%
Armada Hoffler Properties	4.39%	3.40%	0.95%

Valuation & Earnings

This table compares Centerspace and Armada Hoffler Properties”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Centerspace	$260.98 million	3.79	-$10.69 million	($1.80)	-32.81
Armada Hoffler Properties	$546.16 million	1.33	$35.65 million	$0.12	58.38

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

Analyst Ratings

This is a breakdown of recent recommendations for Centerspace and Armada Hoffler Properties, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Centerspace	1	5	3	1	2.40
Armada Hoffler Properties	1	2	2	0	2.20

Centerspace currently has a consensus target price of $68.00, indicating a potential upside of 15.15%. Armada Hoffler Properties has a consensus target price of $8.38, indicating a potential upside of 19.56%. Given Armada Hoffler Properties’ higher possible upside, analysts plainly believe Armada Hoffler Properties is more favorable than Centerspace.

Institutional and Insider Ownership

79.0% of Centerspace shares are held by institutional investors. Comparatively, 66.3% of Armada Hoffler Properties shares are held by institutional investors. 0.4% of Centerspace shares are held by insiders. Comparatively, 10.2% of Armada Hoffler Properties shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Dividends

Centerspace pays an annual dividend of $3.08 per share and has a dividend yield of 5.2%. Armada Hoffler Properties pays an annual dividend of $0.56 per share and has a dividend yield of 8.0%. Centerspace pays out -171.1% of its earnings in the form of a dividend. Armada Hoffler Properties pays out 466.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Centerspace has increased its dividend for 2 consecutive years.

Summary

Armada Hoffler Properties beats Centerspace on 11 of the 18 factors compared between the two stocks.

About Centerspace

Centerspace is an owner and operator of apartment communities committed to providing great homes by focusing on integrity and serving others. Founded in 1970, as of September 30, 2023, Centerspace owned interests in 71 apartment communities consisting of 12,785 apartment homes located in Colorado, Minnesota, Montana, Nebraska, North Dakota, and South Dakota. Centerspace was named a Top Workplace for the fourth consecutive year in 2023 by the Minneapolis Star Tribune.

About Armada Hoffler Properties

Armada Hoffler Properties, Inc. (the “Company”) is a vertically integrated, self-managed real estate investment trust (“REIT”) with over four decades of experience developing, building, acquiring, and managing high-quality retail, office, and multifamily properties located primarily in the Mid-Atlantic and Southeastern United States. In addition to the ownership of the Company’s operating property portfolio, the Company develops and builds properties for its own account and through joint ventures between the Company and unaffiliated partners and also invests in development projects through real estate financing arrangements. The Company also provides general construction and development services to third-party clients. The Company’s construction and development experience includes mid- and high-rise office buildings, retail strip malls, retail power centers, multifamily apartment communities, hotels and conference centers, single- and multi-tenant industrial, distribution, and manufacturing facilities, educational, medical, and special purpose facilities, government projects, parking garages, and mixed-use town centers. The Company is the sole general partner of Armada Hoffler, L.P. (the “Operating Partnership”) and, as of March 31, 2024, owned 75.5% of the economic interest in the Operating Partnership, of which 0.1% is held as general partnership units. The operations of the Company are conducted primarily through the Operating Partnership and the wholly owned subsidiaries thereof.