Head to Head Review: Modiv Industrial (NYSE:MDV) & Innovative Industrial Properties (NYSE:IIPR)

Innovative Industrial Properties (NYSE:IIPR) and Modiv Industrial (NYSE:MDV) are both small-cap real estate companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, profitability, dividends, earnings, valuation, institutional ownership and risk.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Innovative Industrial Properties and Modiv Industrial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Innovative Industrial Properties	1	3	0	0	1.75
Modiv Industrial	0	6	0	0	2.00

Innovative Industrial Properties currently has a consensus price target of $48.00, indicating a potential downside of 15.84%. Modiv Industrial has a consensus price target of $18.50, indicating a potential upside of 2.49%. Given Modiv Industrial’s stronger consensus rating and higher possible upside, analysts plainly believe Modiv Industrial is more favorable than Innovative Industrial Properties.

Dividends

Innovative Industrial Properties pays an annual dividend of $7.60 per share and has a dividend yield of 13.3%. Modiv Industrial pays an annual dividend of $1.20 per share and has a dividend yield of 6.6%. Innovative Industrial Properties pays out 172.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Modiv Industrial pays out 333.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Innovative Industrial Properties has raised its dividend for 4 consecutive years and Modiv Industrial has raised its dividend for 3 consecutive years. Innovative Industrial Properties is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Innovative Industrial Properties and Modiv Industrial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Innovative Industrial Properties	$265.95 million	5.91	$118.25 million	$4.41	12.93
Modiv Industrial	$46.16 million	4.04	$1.07 million	$0.36	50.14

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

Profitability

This table compares Innovative Industrial Properties and Modiv Industrial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Innovative Industrial Properties	52.27%	7.73%	5.69%
Modiv Industrial	16.35%	3.75%	1.55%

Risk and Volatility

Innovative Industrial Properties has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500. Comparatively, Modiv Industrial has a beta of -0.07, suggesting that its share price is 107% less volatile than the S&P 500.

Institutional and Insider Ownership

70.6% of Innovative Industrial Properties shares are owned by institutional investors. Comparatively, 8.2% of Modiv Industrial shares are owned by institutional investors. 2.3% of Innovative Industrial Properties shares are owned by company insiders. Comparatively, 2.8% of Modiv Industrial shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Innovative Industrial Properties beats Modiv Industrial on 12 of the 16 factors compared between the two stocks.

About Innovative Industrial Properties

Innovative Industrial Properties, Inc. is a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized properties leased to experienced, state-licensed operators for their regulated cannabis facilities. Innovative Industrial Properties, Inc. has elected to be taxed as a real estate investment trust, commencing with the year ended December 31, 2017.

About Modiv Industrial

Modiv Industrial, Inc. is an internally managed REIT that is focused on single-tenant net-lease industrial manufacturing real estate. The Company actively acquires critical industrial manufacturing properties with long-term leases to tenants that fuel the national economy and strengthen the nation's supply chains.