Hudson Pacific Properties (NYSE:HPP) versus Easterly Government Properties (NYSE:DEA) Critical Survey

Easterly Government Properties (NYSE:DEA) and Hudson Pacific Properties (NYSE:HPP) are both small-cap real estate companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, dividends, profitability and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations and price targets for Easterly Government Properties and Hudson Pacific Properties, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Easterly Government Properties	1	4	1	0	2.00
Hudson Pacific Properties	3	6	4	0	2.08

Easterly Government Properties presently has a consensus price target of $25.80, indicating a potential upside of 18.27%. Hudson Pacific Properties has a consensus price target of $15.45, indicating a potential upside of 49.25%. Given Hudson Pacific Properties’ stronger consensus rating and higher probable upside, analysts plainly believe Hudson Pacific Properties is more favorable than Easterly Government Properties.

Earnings and Valuation

This table compares Easterly Government Properties and Hudson Pacific Properties”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Easterly Government Properties	$336.10 million	3.07	$13.00 million	$0.21	103.88
Hudson Pacific Properties	$831.10 million	0.68	-$561.69 million	($8.85)	-1.17

Easterly Government Properties has higher earnings, but lower revenue than Hudson Pacific Properties. Hudson Pacific Properties is trading at a lower price-to-earnings ratio than Easterly Government Properties, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Easterly Government Properties and Hudson Pacific Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Easterly Government Properties	2.86%	0.75%	0.30%
Hudson Pacific Properties	-70.04%	-20.76%	-7.73%

Institutional & Insider Ownership

86.5% of Easterly Government Properties shares are held by institutional investors. Comparatively, 97.6% of Hudson Pacific Properties shares are held by institutional investors. 6.5% of Easterly Government Properties shares are held by company insiders. Comparatively, 2.5% of Hudson Pacific Properties shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Risk and Volatility

Easterly Government Properties has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500. Comparatively, Hudson Pacific Properties has a beta of 1.96, meaning that its stock price is 96% more volatile than the S&P 500.

Summary

Easterly Government Properties beats Hudson Pacific Properties on 8 of the 14 factors compared between the two stocks.

About Easterly Government Properties

Easterly Government Properties, Inc. (NYSE: DEA) is based in Washington, D.C., and focuses primarily on the acquisition, development and management of Class A commercial properties that are leased to the U.S. Government. Easterly’s experienced management team brings specialized insight into the strategy and needs of mission-critical U.S. Government agencies for properties leased to such agencies either directly or through the U.S. General Services Administration (GSA).

About Hudson Pacific Properties

Hudson Pacific Properties (NYSE: HPP) is a real estate investment trust serving dynamic tech and media tenants in global epicenters for these synergistic, converging and secular growth industries. Hudson Pacific's unique and high-barrier tech and media focus leverages a full-service, end-to-end value creation platform forged through deep strategic relationships and niche expertise across identifying, acquiring, transforming and developing properties into world-class amenitized, collaborative and sustainable office and studio space.